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Item 9A. Controls and Procedures

2021-03-01 compared with 2020-02-28 · 803 added, 593 removed, 1276 unchanged (52% of the section changed)

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Evaluation of Disclosure Controls and Procedures

Our disclosure controls and procedures are designed to provide reasonable assurance that the information we are required to disclose in reports we file under the Securities Exchange Act of 1934, as amended (the "Exchange Act") is accumulated and appropriately communicated to management.

Our disclosure controls and procedures are designed to provide reasonable assurance that the information that we are required to disclose in reports we file under the Securities Exchange Act of 1934, as amended (the "Exchange Act") is accumulated and appropriately communicated to management.

We carried out an evaluation required by Rule 13a-15(b) of the Exchange Act, under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures at the end of the reporting period.

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Our management is responsible for establishing and maintaining adequate internal control over financial reporting.

Our internal control over financial reporting is a process that is designed under the supervision of our Chief Executive Officer and Chief Financial Officer, and implemented by our Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S.

Controls and Procedures, and Other Information

financial reporting and the preparation of financial statements for external purposes in accordance with U.S.

Our internal control over financial reporting includes those policies and procedures that:

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Changes in Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting (as described in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended December 31, 2019 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

There have been no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during the quarter ended December 31, 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Although most of our corporate employees have shifted to a remote working environment due to the COVID-19 Pandemic, we have not experienced a material impact to our internal control over financial reporting.

We are continually monitoring and assessing the COVID-19 Pandemic to minimize the impact on the design and operating effectiveness of our internal controls.

Report of Independent Registered Public Accounting Firm

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Our general partner, Delek Logistics GP, LLC, is an indirect subsidiary of Delek Holdings.

As of December 31, 2019 , three individuals (Messrs.

Yemin, Ginzburg and Green) who serve as both directors and executive officers of the general partner and as officers and, with respect to Mr.

Yemin, a director, of Delek Holdings, also own membership interests of 5.00%, 0.20% and 0.20%, respectively, in the general partner.

As of December 31, 2020, two individuals (Messrs.

Yemin and Spiegel) serve as both directors and executive officers of the general partner and as officers and, with respect to Mr.

Yemin, a director, of Delek Holdings.

Our general partner manages our operations and activities on our behalf through its officers and directors.

References in this Part III to the "Board," "directors," or "officers" refer to the Board, directors and officers of our general partner.

The Board of Directors of Our General Partner

The directors of our general partner oversee our operations.

The Board of Directors

The directors oversee our operations.

The members of the Board are not elected by our unitholders and will not be subject to re-election by our unitholders in the future.

The general partner is a limited liability company and its directors are elected by its members, all of which are subsidiaries, affiliates, directors, officers and/or employees of Delek Holdings.

The general partner is a limited liability company and its directors are elected by Delek Logistics Services Company, its sole member, which is a subsidiary of Delek Holdings.

The directors hold office for a term of one year or until their successors have been elected or qualified or until their earlier death or removal.

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Because we are a limited partnership, we rely on an exemption from the provisions of Section 303A.01 of the NYSE Listed Company Manual which would require the Board to be composed of a majority of independent directors.

Despite this exemption, our Board is currently comprised of a majority of independent directors, though this could change in the future.

Despite this exemption, our Board is currently comprised of a majority of independent directors, though this composition could change in the future.

We are not required to establish either a compensation or a nominating and corporate governance committee.

We are, however, required to have an audit committee of at least three members, and all of our audit committee members are required to meet the independence and experience tests established by the NYSE and the Exchange Act.

At the date of this report, the Board consists of the following eight members:

Ezra Uzi Yemin, Charles J.

At the date of this report, the Board consists of the following nine members:

Ezra Uzi Yemin, Sherri A.

Brillon, Charles J.

Brown, III, Francis C.

D'Andrea, Eric D.

Gadd, Assaf Ginzburg, Frederec Green, Ronald Haddock and Reuven Spiegel.

Gadd, Frederec Charles Green, Ron W.

Haddock, Gennifer F.

Kelly and Reuven Spiegel.

The Board has determined that each of Messrs.

Brown, D'Andrea, Gadd, Haddock and Spiegel qualifies as an independent director under applicable SEC rules and regulations and the rules of the NYSE.

Brown, D'Andrea, Gadd and Haddock and Mses.

Brillon and Kelly qualifies as an independent director under applicable SEC rules and regulations and the rules of the NYSE.

Under the NYSE's listing standards, a director will not be deemed independent unless the Board affirmatively determines that the director has no material relationship with us.

Based upon information requested from and provided by each director concerning his background, employment and affiliations, including commercial, industrial, banking, consulting, legal, accounting, charitable and familial relationships, the Board has determined that each of Messrs.

Brown, D'Andrea, Gadd, Haddock and Spiegel has no material relationship with Delek Holdings or us, either directly or as a partner, stockholder or officer of an organization that has a relationship with Delek Holdings or us, and each of them is therefore independent under the NYSE's listing standards and applicable SEC rules and regulations.

Based upon information requested from and provided by each director concerning his or her background, employment and affiliations, including commercial, industrial, banking, consulting, legal, accounting, charitable and familial relationships, the Board has determined that each of Messrs.

Brown, D'Andrea, Gadd and Haddock and Mses.

Brillon and Kelly has no material relationship with Delek Holdings or us, either directly or as a partner, stockholder or officer of an organization that has a relationship with Delek Holdings or us, and each of them is therefore independent under the NYSE's listing standards and applicable SEC rules and regulations.

Director Experience and Qualifications

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All of our general partner's executive officers are employees and officers of Delek Holdings.

While the amount of time that our general partner's executive officers devote to our business varies in any given year, we currently estimate that approximately 10% to 20% of their productive business time is spent on the management and conduct of our operations for all executive officers, except for Mr.

Sakazi, who devotes a majority of his time to our operations.

The executive officers of our general partner intend to devote as much of their time as is necessary for the proper conduct of our business.

We also utilize a significant number of Delek Holdings' employees to operate our business and provide us with general and administrative services.

Under the Omnibus Agreement, we pay Delek Holdings an annual fee, indexed for inflation, for Delek Holdings' provision of centralized corporate services, including executive management services of Delek Holdings employees who devote less than 50% of their time to our

Directors, Executive Officers, Corporate Governance, and Security Ownership

business, financial and administrative services, information technology services, legal services, health, safety and environmental services, human resource services, and insurance administration.

time to our business, financial and administrative services, information technology services, legal services, health, safety and environmental services, human resource services, and insurance administration.

In addition, we reimburse Delek Holdings for allocated expenses of personnel who devote 50% or more of their time performing services for our benefit.

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The following table shows information for the directors and executive officers of our general partner.

Position With Delek Logistics GP, LLC

Ezra Uzi Yemin

Chairman of the Board of Directors, Chief Executive Officer and President

Director, Chairman of Conflicts Committee and Member of Audit and EHS Committees

Director, Chairman of Audit Committee and Member of Conflicts and EHS Committees

Director, Chairman of EHS Committee and Member of Audit and Conflicts Committees

Assi Ginzburg

Director, Executive Vice President and Chief Financial Officer

Frederec Green

Director and Executive Vice President

Director and Member of EHS Committees

Reuven Spiegel

Director and Member of Audit, EHS and Conflicts Committees

Executive Vice President, General Counsel and Secretary

Executive Vice President

Senior Vice President, Delek Logistics

Name Age Position With Delek Logistics GP, LLC

Ezra Uzi Yemin 52 Chairman of the Board of Directors, Chief Executive Officer and President

Brillon 61 Director and Member of Audit Committee

Brown, III 73 Director, Chairman of Conflicts Committee and Member of Audit and EHS Committees

D'Andrea 67 Director, Chairman of Audit Committee and Member of Conflicts and EHS Committees

Gadd 65 Director, Chairman of EHS Committee and Member of Audit and Conflicts Committees

Frederec Charles Green 55 Director

Haddock 80 Director and Member of EHS Committees

Kelly 48 Director and Member of Conflicts and EHS Committees

Reuven Spiegel 64 Director, Executive Vice President and Chief Financial Officer

Denise McWatters 61 Executive Vice President, General Counsel and Secretary

Odely Sakazi 37 Senior Vice President, Delek Logistics

Ezra Uzi Yemin has served as the Chief Executive Officer and the Chairman of the Board of our general partner since April 2012.

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Yemin also brings to the Board substantial leadership, planning and industry experience.

Brillon has served as a member of the Board of our general partner and as a member of the Audit Committee since January 2021.

Starting in 2008, Ms.

Brillon held various positions of increasing responsibility at Encana Corporation, a leading North American hydrocarbon exploration and marketing company now known as Ovintiv Inc., before retiring as Executive Vice President and Chief Financial Officer in 2019.

At Encana, Ms.

Brillon was responsible for directing the financial operations of the organization and she also implemented Encana's business strategy through multiple strategic transactions.

Brillon is a past director of the Canadian Chamber of Commerce, Alberta Energy Regulator, Tim Hortons Inc., a Canadian multinational fast food restaurant chain, and PrairieSky Royalty Ltd., which owns properties generating royalty revenues from petroleum and natural gas in Canada.

Brillon provides the Board with financial and strategic experience from her many years in the energy industry.

Brown, III has served as a member of the Board of our general partner since November 2012, as a member of the Audit Committee and Conflicts Committee (of which he is Chairman) since November 2012 and as a member of the Environmental, Health and Safety Committee (the "EHS Committee") since its inception in October 2016.

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From 1979 through his retirement in 2012, Mr.

D’Andrea served in various roles with Deloitte & Touche LLP, culminating in the role of senior partner from 2011 through 2012, preceded by his role as managing partner from 2005 through 2011 of Deloitte’s Houston/New Orleans audit practice, and was involved in such capacities with several public companies, including sponsors of master limited partnerships.

Directors, Executive Officers, Corporate Governance, and Security Ownership

including sponsors of master limited partnerships.

D’Andrea was appointed to the Board of our general partner because the Board believes that his experience as a certified public accountant and partner with Deloitte & Touche LLP provides the Board with valuable experience in matters involving finance and accounting in general and master limited partnerships in particular.

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He has over 40 years of diverse experience in the energy industry including exploration and production field services, mid-stream, renewable energy, commodity trading and risk management, and mergers and acquisitions.

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to forming Awelon LLC in 2006, Mr.

Prior to forming Awelon LLC in 2006, Mr.

Gadd held various executive positions with multiple leading companies in the energy industry over a 25-year period.

Gadd was appointed to the Board because of his extensive energy industry experience.

Assaf Ginzburg has served as the Chief Financial Officer of our general partner and Delek Holdings since March 2019 and as an Executive Vice President and member of the Board of our general partner since April 2012.

Ginzburg has also served as Delek Holdings' executive vice president since May 2009 and as a vice president of Delek Holdings since February 2005.

Previously, Mr.

Ginzburg served as chief financial officer of our general partner and Delek Holdings from January 2013 to June 2017 and as a member of the board of directors of Alon USA Energy, Inc.

from May 2015 until its acquisition by Delek Holdings in July 2017.

Ginzburg has been a member of the Israel Institute of Certified Public Accountants since 2001.

Ginzburg was instrumental in the successful completion of our initial public offering in November 2012, and he was appointed to the Board because his financial experience and knowledge of our and Delek Holdings' businesses provide the Board with valuable expertise into relevant business and financial and accounting matters.

Frederec Green has been an Executive Vice President and a member of the Board of our general partner since April 2012.

Green has been Delek Holdings' chief operating officer since November 2016, an executive vice president of Delek Holdings since May 2009 and was the primary operational officer for Delek Holdings' refining operations from January 2005 to December 2016.

Frederec Charles Green has served as a member of the Board of our general partner since April 2012.

Green previously served as Delek Holdings' chief operating officer from November 2016 to April 2020 and as an executive vice president from May 2009 until his departure in November 2020.

Green was the primary operational officer for Delek Holdings' refining operations from January 2005 to December 2016.

He served as an executive vice president and chief operating officer of Alon USA Partners GP, LLC from July 2017 until its acquisition by Delek Holdings in February 2018, its chief executive officer from August 2017 until its acquisition by Delek Holdings in February 2018, and a member of the board of directors of Alon USA Energy, Inc.

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Haddock has served as a member of the Board of our general partner and as a member of the Environmental, Health and Safety Committee since May 2018.

Haddock has served as our Lead Independent Director since February 2021.

Haddock is currently Chairman and Chief Executive Officer of AEI Services LLC, an international power generation/distribution and natural gas distribution company, positions he has held since 2004 and August 2003, respectively.

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Haddock’s extensive directorship experience, past executive positions within the refining industry, financial reporting background and expertise qualify him to serve as a member of the Board.

Reuven Spiegel has served as a member of the Board of our general partner since July 2014, as a member of the Audit Committee and Conflicts Committee since September 2014 and as a member of the EHS Committee since its inception in October 2016.

Spiegel is the lead director.

Kelly has served as a member of the Board of our general partner and as a member of the Conflicts Committee and EHS Committee since July 29, 2020.

She has 25 years of oil and gas industry experience in both upstream and midstream sectors.

Kelly previously held the role of Chief Operating Officer and SVP of Western Midstream Partners (NYSE:

WES) and Vice President of Marketing for Anadarko Petroleum Corporation.

Prior to her role at Western Midstream, Ms.

Kelly led Operations Transformation efforts, as well as Strategic Planning, Portfolio Management and Asset Management teams for Anadarko.

She has diverse operations experience in production, drilling and completions engineering, working extensively in East Texas, West Texas and the Gulf of Mexico.

Prior to joining Anadarko Petroleum, Ms.

Kelly worked as an engineer for Kerr McGee Corporation and the Louisiana Office of Conservation.

The Board values Ms.

Kelly's years of experience in the oil and gas industry and operations experience as well as her technical background.

Reuven Spiegel has served as our Chief Financial Officer since May 8, 2020, and as a member of the Board of our general partner since July 2014.

Prior to becoming our Chief Financial Officer, Mr.

Spiegel was also a member of the Audit Committee and Conflicts Committee since September 2014 and as a member of the EHS Committee since its inception in October 2016.

Spiegel has served in the financial and real estate industry since 1983.

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Spiegel's financial industry experience provides the Board with valuable expertise in the Partnership's financial and accounting matters.

Regina Bynote Jones has served as Executive Vice President, General Counsel and Secretary of our general partner since May 2018.

She has also served as the executive vice president, general counsel and secretary of Delek Holdings since May 2018.

Prior to joining the Company, Ms.

Jones served as general counsel of the land rigs division for Schlumberger, Ltd., a global oil and gas technology company.

Jones joined Schlumberger in 2005 as geomarket counsel in the United States and held roles of increasing responsibility including global manager of client contracts, global manager - trade compliance, general counsel - research, engineering, manufacturing and sustaining, general counsel - petrotechnical services and general counsel - Asia.

Her previous experience also includes service in various roles with energy companies Shell Services International, Dynegy Inc.

and El Paso Corporation.

Jones earned a Bachelor of Business Administration degree from Sam Houston State University and her Juris Doctorate from the South Texas College of Law in Houston, Texas.

Avigal Soreq has been an Executive Vice President of our general partner since October 2015 and a Vice President since December 2012.

He has also served as Delek Holdings' chief commercial officer since November 2016, an executive vice president of Delek Holdings since August 2015 and as a vice president of Delek Holdings since December 2012.

He served as a member of the board of directors of Alon USA Energy, Inc.

from May 2015 until its acquisition by Delek Holdings in July 2017.

Prior to joining us in October 2011, Mr.

Soreq worked in business development for SunPower Corporation (NASDAQ:

SPWR), an American energy company that designs and manufactures solar panels.

Prior to joining SunPower Corporation, Mr.

Soreq worked as a senior finance and business consultant for Trabelsy & Co and as a consultant in the corporate finance department for KPMG’s Tel-Aviv office.

Soreq served in the Israeli Air Force in various roles between 1996 and 2004 and reached the rank of Major.

Soreq is a certified public accountant in Israel.

Denise McWatters has served as the Executive Vice President, General Counsel and Corporate Secretary of our general partner and Delek Holdings since February 2021.

McWatters previously served as the general counsel, chief compliance officer and corporate secretary of HollyFrontier Corporation, an independent petroleum refiner (NYSE:

HFC), and of the general partner of Holly Energy Partners, L.P.

HEP) from 2008 until August 2019.

Prior to joining HollyFrontier, Ms.

McWatters served as the general counsel of The Beck Group, an architecture, construction and design firm, from 2005 to 2007.

Odely Sakazi has served as Senior Vice President, Delek Logistics since August 2019.

He previously served as our vice president of business strategy and corporate development from November 2017 until August 2019, as senior director of business strategy from January 2017 until

He previously served as our Vice President of Business Strategy and corporate development from November 2017 until August 2019, as Senior Director of Business Strategy from

Directors, Executive Officers, Corporate Governance, and Security Ownership

November 2017, as director of business strategy from June 2016 until January 2016, and as director of corporate operation from August 2015 until June 2016.

January 2017 until November 2017, as Director of Business Strategy from June 2016 until January 2016, and as Director of Corporate Operation from August 2015 until June 2016.

He formerly served in the Israeli Navy as an officer in various roles between 2010 and 2014.

Board Leadership Structure

Yemin serves as Chairman of the Board.

Our general partner has no policy with respect to the unification or separation of the offices of Chairman and CEO.

Yemin serves as Chair of the Board.

Our general partner has no policy with respect to the unification or separation of the offices of Chair and CEO.

Rather, the Board's policy is to let the Board make such a determination in the manner it deems most appropriate for the general partner and us at a given point in time.

At this time, the Board believes that our general partner's Chief Executive Officer is best situated to serve as Chairman of the Board because he is the director most familiar with our business and industry.

He is also the Chairman of the board of directors of Delek Holdings, which provides the Board and us with important interaction with, and access to, our most important customer and majority unitholder.

Yemin also brings to the Board and us the perspectives of our majority unitholder and the principal executive officer and chairman of the board of a publicly traded company.

As such, the Board feels that combining the roles of Chairman and CEO provides the Board with the individual who is most capable of effectively identifying strategic priorities and leading the discussion and execution of strategy and facilitating the information flow between management and the Board and its committees, which are essential to effective governance of the Partnership.

The Board met 21 times in the year ended December 31, 2019 , with each director attending at least 75% of the aggregate of all meetings of the Board and committees on which he served during the year.

At this time, the Board believes that our general partner's Chief Executive Officer is best situated to serve as Chair of the Board because he is the director most familiar with our business and industry.

He is also the Chair of the board of directors of Delek Holdings, which provides the Board and us with important interaction with, and access to, our most important customer and majority unitholder.

Yemin also brings to the Board and us the perspectives of our majority unitholder and the principal executive officer and chair of the board of a publicly traded company.

As such, the Board feels that combining the roles of Chair and CEO provides the Board with the individual who is most capable of effectively identifying strategic priorities and leading the discussion and execution of strategy and facilitating the information flow between management and the Board and its committees, which are essential to effective governance of the Partnership.

The Board met 21 times in the year ended December 31, 2020, with each director attending at least 75% of the aggregate of all meetings of the Board and committees on which he or she served during the year.

Because the Chair of the Board is not an independent director, on February 22, 2021, the Board designated Ron W.

Haddock to serve in a lead capacity (the “Lead Independent Director”) to coordinate the activities of the other independent directors and to perform such other duties and responsibilities as the Board may determine from time to time.

The Lead Independent Director is appointed annually by the Board and may be removed from or replaced at any time.

The Lead Independent Director will chair all meetings of the Board at which the Chair is not present, including executive sessions of the independent directors, call additional meetings of the independent directors as deemed appropriate, and perform such other functions as the Board may direct.

Executive Sessions

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Our independent directors generally conduct such executive sessions in connection with each quarterly meeting of the Audit Committee and otherwise as may be necessary.

Spiegel was appointed lead independent director of the Board in 2018.

Haddock was appointed Lead Independent Director of the Board in February 2021.

In this capacity, Mr.

Spiegel generally presides over these executive sessions.

Haddock generally presides over these executive sessions.

Communications with the Board of Directors of Our General Partner

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The Audit Committee consists of Messrs.

D'Andrea (chairman), Brown, Gadd and Spiegel.

D'Andrea (chairman), Brown and Gadd and Ms.

D'Andrea joined the committee in August 2015.

Brown joined the committee at its inception in November 2012, and Messrs.

Gadd and Spiegel joined the committee in October 2013 and September 2014, respectively.

The Audit Committee met ten times during the year ended December 31, 2019 , either in person or telephonically, with each member attending at least 75% of all meetings of the Audit Committee.

Brown joined the committee at its inception in November 2012, Mr.

Gadd joined the committee in October 2013, and Ms.

Brillon joined the committee in January 2021.

The Audit Committee met nine times during the year ended December 31, 2020, either in person or telephonically, with each member attending at least 75% of all meetings of the Audit Committee.

The Board has determined that (i) each of Messrs.

D'Andrea, Brown, Gadd and Spiegel qualifies as independent and as financially literate under applicable SEC rules and regulations and the rules of the NYSE, and (ii) Mr.

D'Andrea, Brown and Gadd and Ms.

Brillon qualifies as independent and as financially literate under applicable SEC rules and regulations and the rules of the NYSE, and (ii) Mr.

D'Andrea meets the definition of an “audit committee financial expert” within the meaning of Item 407(d)(5) of Regulation S-K.

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These responsibilities are set forth in the Audit Committee’s charter, which is available on our corporate website at www.DelekLogistics.com.

Directors, Executive Officers, Corporate Governance, and Security Ownership

Conflicts Committee

The Conflicts Committee consists of Messrs.

Brown (chairman), D'Andrea, Gadd, Haddock and Spiegel.

Brown (chairman), D'Andrea and Gadd and Ms.

The Board has determined that each of Messrs.

Brown, D'Andrea, Gadd, Haddock and Spiegel qualifies as independent under applicable SEC rules and regulations and the rules of the NYSE.

Brown, D'Andrea and Gadd and Ms.

Kelly qualifies as independent under applicable SEC rules and regulations and the rules of the NYSE.

Brown joined the committee at its inception in November 2012.

Gadd, Spiegel, D'Andrea and Haddock joined the committee in October 2013, September 2014, August 2015 and July 2017, respectively.

The Conflicts Committee met two times during the year ended December 31, 2019 , either in person or telephonically, with each member attending at least 75% of all meetings of the Conflicts Committee.

Directors, Executive Officers, Corporate Governance, and Security Ownership

Gadd and D'Andrea joined the committee in October 2013 and August 2015, respectively.

Kelly joined the committee on July 29, 2020.

The Conflicts Committee met 19 times during the year ended December 31, 2020, either in person or telephonically, with each member attending at least 75% of all meetings of the Conflicts Committee.

Our Partnership Agreement does not require that the Board seek approval from the Conflicts Committee to determine the resolution of any conflict of interest between us and Delek Holdings or any other person.

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The EHS Committee consists of Messrs.

Gadd (chairman), D'Andrea, Brown, Haddock and Spiegel.

Gadd, Brown, D'Andrea and Spiegel joined the committee at its inception in October 2016 and Mr.

Haddock joined the committee in May 2018.

Gadd (chairman), D'Andrea, Brown and Haddock and Ms.

Gadd, Brown and D'Andrea joined the committee at its inception in October 2016, Mr.

Haddock joined the committee in May 2018, and Ms.

Kelly joined the committee in July 2020.

The EHS Committee met four times in 2020, either in person or telephonically, with each member attending at least 75% of all meetings of the EHS Committee.

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Candidates to serve on the Board are reviewed and selected in accordance with our general partner's Governance Guidelines, which are available on our corporate website at www.DelekLogistics.com.

Pursuant to the merger agreement governing the merger of Delek Holdings and Alon USA Energy, Inc.

(the "Delek Holdings/Alon Merger"), which was effective July 1, 2017, Delek Holdings agreed to cause our general partner to increase the size of the Board by one seat, to appoint an individual selected by the Independent Director Committee of Alon USA prior to the closing date of the Delek Holdings/Alon Merger to such newly created seat, and to cause such individual to be re-elected to the Board for terms to be no less than two years after the closing date of the Delek Holdings/Alon Merger, subject to our Governance Guidelines.

Ronald Haddock was designated by the Independent Director Committee of Alon USA to fill such seat and, on July 18, 2017, the Board elected Mr.

Haddock to fill such seat for a term ending no less than two years after the closing date of the Delek Holdings/Alon Merger, subject to our Governance Guidelines.

Compensation Decisions

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Executive Compensation.

Directors, Executive Officers, Corporate Governance, and Security Ownership

Governance Guidelines, Code of Business Conduct & Ethics and Committee Charters

The Governance Guidelines of the Board of Directors of our general partner, the charter of the Audit Committee of our general partner and our Code of Business Conduct & Ethics covering all employees, including our principal executive officer, principal financial officer, principal accounting officer and controllers, are available on our website, www.DelekLogistics.com under the "About Us - Corporate Governance" caption.

The Governance Guidelines of the Board of Directors of our general partner, the charter of the Audit Committee of our general partner and our Amended and Restated Code of Business Conduct & Ethics covering all employees, including our principal executive officer, principal financial officer, principal accounting officer and controllers, are available on our website, www.DelekLogistics.com under the "About Us - Corporate Governance" caption.

A copy of any of these documents will be mailed upon a request made to Investor Relations, Delek Logistics Partners, LP, or ir@deleklogistics.com.

We intend to disclose any amendments to, or waivers of, the Code of Business Conduct & Ethics on behalf of our

Directors, Executive Officers, Corporate Governance, and Security Ownership

Chief Executive Officer, Chief Financial Officer and persons performing similar functions on our website, at www.DelekLogistics.com , under the “Investor Relations” caption, promptly following the date of any such amendment or waiver.

We intend to disclose any amendments to, or waivers of, the Code of Business Conduct & Ethics on behalf of our Chief Executive Officer, Chief Financial Officer and persons performing similar functions on our website, at www.DelekLogistics.com, under the “Investor Relations” caption, promptly following the date of any such amendment or waiver.

EXECUTIVE COMPENSATION

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This CD&A provides context and background for the compensation earned and awarded to the individuals named in the Summary Compensation Table below.

Yemin, Kremke and Ginzburg are referred to collectively herein as our "named executive officers" or "NEOs".

Yemin, Spiegel and Ginzburg are referred to collectively herein as our "named executive officers" or "NEOs".

Overview - Compensation Decisions and Allocation of Compensation Expenses

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• to motivate and retain our general partner's key executives;

Directors, Executive Officers, Corporate Governance, and Security Ownership

• to align the long-term economic interests of our general partner's executives with those of our unitholders;

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No phantom units were granted to our executive officers in 2020.

Directors, Executive Officers, Corporate Governance, and Security Ownership

Pursuant to the terms of the LTIP, upon the occurrence of an Exchange Transaction (as defined in the LTIP, and generally including a merger, consolidation, acquisition, reorganization or similar extraordinary transaction), the Board may, in its discretion, accelerate the vesting of the phantom units, adjust the terms of any outstanding phantom units, or, in the event of an Exchange Transaction in which our unitholders receive equity of another entity, provide for the conversion of the phantom units into comparable awards for such entity's equity.

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The members of the Conflicts Committee have reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and discussions, the Conflicts Committee recommended to the Board of our general partner that the Compensation Discussion and Analysis be included in this Annual Report on Form 10-K.

The members of the Conflicts Committee have submitted this Compensation Committee Report to the Board of Directors as of February 27, 2020:

The members of the Conflicts Committee have submitted this Compensation Committee Report to the Board of Directors as of March 1, 2021:

Brown, III (Chairman)

Reuven Spiegel

• Gennifer F.

Directors, Executive Officers, Corporate Governance, and Security Ownership

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The Summary Compensation Table below summarizes the compensation for the fiscal year ended December 31, 2020 (and the two prior fiscal years) for our general partner's principal executive officer (Mr.

Yemin), former principal financial officer (Mr.

Kremke) and current principal financial officer (Mr.

Yemin), current principal financial officer (Mr.

Spiegel) and former principal financial officer (Mr.

Name and Principal Position (1)

Unit Awards ($)

Option Awards ($)

Other Compensation ($)

Fiscal Year Salary ($) Bonus ($) Unit Awards ($) Option Awards ($) Other Compensation ($) Total ($)

Ezra Uzi Yemin,

Chief Executive Officer 2020 — — — — — —

Former Chief Financial Officer

Assaf Ginzburg

2019 — — — — — —

2018 — — — — — —

Reuven Spiegel,

Chief Financial Officer

2020 — — — — — —

2019 — — — — — —

2018 — — — — — —

Assaf Ginzburg,

Former Chief Financial Officer 2020 — — — — — —

2019 — — — — — —

2018 — — — — — —

(1) Because none of our executive officers received total compensation from us or our general partner in excess of $100,000 in 2020, information is presented only for Messrs.

Yemin, Kremke and Ginzburg.

Yemin, Spiegel and Ginzburg.

Grants of Plan Based Awards in 2020

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The following table provides information regarding the number of outstanding equity awards held by our NEOs at December 31, 2020.

Option Awards

Number of Securities Underlying Unexercised Options Exercisable

Number of Securities Underlying Unexercised Options Unexercisable

Option Exercise Price

Option Expiration Date

Number of Units That Have Not Vested

Market Value of Units That Have Not Vested

Option Awards Unit Awards

Name Number of Securities Underlying Unexercised Options Exercisable Number of Securities Underlying Unexercised Options Unexercisable Option Exercise Price Option Expiration Date Number of Units That Have Not Vested Market Value of Units That Have Not Vested

Ezra Uzi Yemin

Chief Executive Officer — — n/a n/a — $—

Reuven Spiegel

Chief Financial Officer — — n/a n/a — $—

Assaf Ginzburg

Former Chief Financial Officer — — n/a n/a — $—

Option Exercises and Stock Vested in 2020

The following table provides information about the vesting of phantom units for our NEOs during fiscal year 2020.

Option Awards

Number of Shares Acquired on Exercise

Value Realized on Exercise

Number of Shares Acquired on Vesting

Value Realized on Vesting

Ezra Uzi Yemin

Assaf Ginzburg

Option Awards Stock Awards

Name Number of Shares Acquired on Exercise Value Realized on Exercise Number of Shares Acquired on Vesting Value Realized on Vesting

Ezra Uzi Yemin, Chief Executive Officer — n/a — $—

Reuven Spiegel, Chief Financial Officer — n/a — $—

Assaf Ginzburg, Former Chief Financial Officer — n/a — $—

Potential Payments Upon Termination or Change-In-Control

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Factors that could affect these amounts include the timing during the year of such event and our stock price.

Termination of Employment

Change-In-Control

Ezra Uzi Yemin

Assaf Ginzburg

Name Termination of Employment Change-In-Control

Ezra Uzi Yemin, Chief Executive Officer — $—

Reuven Spiegel, Chief Financial Officer — $—

Assaf Ginzburg, Former Chief Financial Officer — $—

2012 Long-Term Incentive Plan

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The compensation framework for the Board's other directors during 2020 (Messrs.

Brown, D'Andrea, Gadd, Haddock and Spiegel) (the "Compensated Directors") was determined by the Board.

Brown, D'Andrea, Gadd and Haddock and Ms.

Kelly) (the "Compensated Directors") was determined by the Board.

Brillon was appointed to the Board in January 2021 and therefore was not compensated in 2020.

In setting compensation for the Compensated Directors, the Board considers various factors and objectives, including aligning the interests of Compensated Directors with the interests of unitholders and attracting and retaining qualified directors to serve on the Board.

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Committee Retainers (Per Year):

Chairman Others

Audit Committee $12,000 $5,600

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Stock Awards ($) (3)

Option Awards ($)

All Other Compensation ($)

Option Awards ($) All Other Compensation ($) Total ($)

Brown, III 87,000 99,973 — — 186,973

D'Andrea 90,900 99,973 — — 190,873

Gadd 88,100 99,973 — — 188,073

Haddock 76,400 99,973 — — 176,373

Gennifer Kelly

33,994 87,656 (4)

Reuven Spiegel 27,306 99,973 — — 127,279

(1) Because they are officers and employees of Delek Holdings or its subsidiaries, Messrs.

Yemin, Ginzburg and Green did not receive any compensation for their service as directors in 2019 .

Yemin and Spiegel do not receive any compensation for their service as directors.

The director fees reported above for Mr.

Spiegel were paid prior to becoming an employee of Delek Holdings in April 2020.

Green resigned on November 11, 2020 and is no longer an officer and employee of Delek Holdings.

He did not receive any compensation for his services as director in 2020.

Brillon was not appointed to the Board until 2021.

(2) This column reports the amount of cash compensation earned in 2020 for Board and committee service and the Lead Director Fee.

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The grant date fair value of $27.36 per unit is equal to the NYSE closing price of our common units as of June 10, 2020.

Brown, D'Andrea, Gadd, Haddock and Spiegel held 1,619, 1,619, 1,619, 1,619 and 1,619 outstanding phantom units, respectively, at December 31, 2019 .

Each of Messrs.

Brown, D'Andrea, Gadd, Haddock and Spiegel held 1,827 outstanding phantom units at December 31, 2020.

(4) The grant date fair value of $31.15 per unit is equal to the NYSE closing price of our common units as of December 10, 2020.

Kelly held 1,407 outstanding phantom units at December 31, 2020.

Compensation Committee Interlocks and Insider Participation

Brown, D'Andrea, Gadd, Haddock and Spiegel served on the Conflicts Committee during 2019 and Mr.

Brown, D'Andrea, Gadd and Haddock and Ms.

Kelly served on the Conflicts Committee during 2020 and Mr.

Yemin and the Board assisted the committee with respect to compensation matters.

Spiegel resigned from the Conflicts Committee upon becoming Chief Financial Officer in May 2020, and Ms.

Kelly was appointed to the Conflicts Committee in July 2020.

There are no interlocking relationships requiring disclosure pursuant to Item 407(e)(4)(iii) of Regulation S-K.

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Unless otherwise indicated below, each person or entity has an address in care of our principal executive offices at 7102 Commerce Way, Brentwood, Tennessee 37027.

Directors, Executive Officers, Corporate Governance, and Security Ownership

Name of Beneficial Owner (1)

Amount, Nature and Percentage of Beneficial Ownership of Common Units (2)

Amount, Nature and Percentage of Beneficial Ownership of General Partner Units (2)

Amount and Nature of Beneficial Ownership of Common Stock (2)

Delek Logistics Partners, LP

Delek US Holdings, Inc.

Delek Logistics Partners, LP Delek US Holdings, Inc.

(#) (%) (#) (3)

Beneficial Owners of More Than 5% of Units:

Delek US Holdings, Inc.

Tortoise Capital Advisors, L.L.C.

34,745,868 80.0 n/a n/a

Directors, Director Nominees and NEOs:

Ezra Uzi Yemin (5)

Charles Brown

267,522 * 796,314 1.1

Brillon — n/a — n/a

Brown, III 18,792 * — n/a

D'Andrea 10,678 * — n/a

Gadd 19,617 * — n/a

Frederec Charles Green (6)

68,552 * 152,918 *

Haddock 10,392 * 17,517 *

Kelly 1,407 * — n/a

Reuven Spiegel 11,191 * — n/a

Denise McWatters — n/a — n/a

Odely Sakazi 330 * 456 *

Assaf Ginzburg (7)

Frederec Green (8)

Reuven Spiegel

Regina Jones (9)

Avigal Soreq (10)

Kevin Kremke (11)

16,510 * 56,421 *

All directors, all director nominees, all NEOs and all executive officers as a group (11 persons)

408,481 0.9 967,205 1.3

* Less than 1% of our issued and outstanding common units of Delek Logistics Partners, LP or issued and outstanding shares of Delek US Holdings, Inc.

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(2) For purposes of this table, a person is deemed to have “beneficial ownership” of any securities when such person has the right to acquire them within 60 days after the Measurement Date.

The percentage of our units beneficially owned is based on a total of 24,425,625 common units representing limited partner interests and 498,482 general partner units issued and outstanding on the Measurement Date.

The percentage of our units beneficially owned is based on a total of 43,443,336 common units representing limited partner interests issued and outstanding on the Measurement Date.

The percentage ownership of Delek US Holdings, Inc.

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For stock appreciation rights (“SARs”) under the Delek US Holdings, Inc.

2006 Long-Term Incentive Plan, or 2016 Long-Term Incentive Plan, we report the shares that would be delivered upon exercise

Directors, Executive Officers, Corporate Governance, and Security Ownership

of SARs that are vested or that will vest within 60 days of the Measurement Date (which is calculated by multiplying the number of SARs by the difference between the $28.27 fair market value of Delek US Holdings, Inc.

2006 Long-Term Incentive Plan, or 2016 Long-Term Incentive Plan, we report the shares that would be delivered upon exercise of SARs that are vested or that will vest within 60 days of the Measurement Date (which is calculated by multiplying the number of SARs by the difference between the $24.00 fair market value of Delek US Holdings, Inc.

Common Stock on the Measurement Date and the exercise price divided by $24.00).

(4) Subsidiaries of Delek US Holdings, Inc.

hold the common units and general partner units.

Lion Oil Company and Delek Marketing & Supply, LLC directly hold 12,611,465 and 2,682,581 common units, respectively.

Delek Logistics GP, LLC directly holds all general partner units.

hold the common limited partner units.

Delek US Energy, Inc.

and Delek Logistics Services Company directly hold 20,745,868 and 14,000,000 common limited partner units, respectively.

Delek US Holdings, Inc.

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files information with, or furnishes information to, the SEC pursuant to the information requirements of the Exchange Act, as amended.

(5) According to a Schedule 13G filed with the SEC on February 14, 2020 by Tortoise Capital Advisors, L.L.C.

(with an address of 5100 W 115th Place, Leawood, KS 66211).

The Schedule 13G reports that Tortoise Capital Advisors, L.L.C.

has shared voting power with respect to 481,177 of the reported units and shared dispositive power with respect to all of the reported units.

(5) 155,170 of our units and 663,645 shares of Delek US Holdings, Inc.

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Yemin, 97,000 are pledged as security for a full recourse loan.

(7) Delek US Holdings, Inc.

Common Stock includes 1,779 RSUs that will vest within 60 days of the Measurement Date and 9,411 performance-vesting RSUs for completed performance periods that will vest within 60 days of the Measurement Date.

Additionally, of the Delek Logistics Partners, LP units owned by Mr.

Ginzburg, 16,510 are pledged as security for a full recourse loan.

(8) Delek US Holdings, Inc.

Common Stock includes 2,059 RSUs that will vest within 60 days of the Measurement Date and 9,411 performance-vesting RSUs for completed performance periods that will vest within 60 days of the Measurement Date.

(6) Additionally, of the Delek US Holdings, Inc.

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Green, 29,500 are pledged as security for a full recourse loan.

(9) Delek US Holdings, Inc.

Common Stock includes 742 RSUs that will vest within 60 days of the Measurement Date.

(10) Delek US Holdings, Inc.

Common Stock includes 504 RSUs that will vest within 60 days of the Measurement Date and 4,705 performance vesting RSUs for completed performance periods that will vest within 60 days of the Measurement Date.

(7) Beneficial ownership for Mr.

Kremke, our former chief financial officer, is based on his most recent Form 4 filing with the SEC.

Ginzburg, our former chief financial officer, is based on his most recent Form 4 filing with the SEC.

Directors, Executive Officers, Corporate Governance, and Security Ownership

EQUITY COMPENSATION PLAN INFORMATION

The following table provides certain information as of December 31, 2020 regarding our general partner's equity compensation plans.

Plan Category

Number of securities to be issued upon exercise of outstanding options, warrants and rights

Weighted-average exercise price of outstanding options, warrants and rights

Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))

Equity compensation plans approved by security holders

Equity compensation plans not approved by security holders

Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))

Equity compensation plans approved by security holders 603,589 N/A 66,226

Equity compensation plans not approved by security holders — N/A —

TOTAL 603,589 N/A 66,226

(a) The amounts in column (a) of this table reflect only phantom units that have been granted under the LTIP.

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For information about the LTIP, which did not require approval by our limited partners, refer to Item 11 of this Annual Report on Form 10-K.

Directors, Executive Officers, Corporate Governance, and Security Ownership

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

Certain Relationships and Related Transactions

As of February 21, 2020 , Delek Holdings and its affiliates owned 15,294,046 common units and 498,482 general partner units, as well as incentive distribution rights, which collectively represents a 63.4% ownership interest in the Partnership.

Certain transactions with Delek Holdings and its affiliated entities are considered to be related party transactions under Item 404 of Regulation S-K because Delek Holdings and its affiliates, including our general partner, own more than five percent of our equity interests.

In addition, Messrs Yemin, Ginzburg, Green, Serff, Soreq and Ms.

Jones serve as executive officers of both Delek Holdings and our general partner.

Distributions and Payments to Delek Holdings and Our General Partner

Directors, Executive Officers, Corporate Governance, and Security Ownership

Pursuant to our Partnership Agreement, we are required to make quarterly cash distributions of 98% of our "available cash" to limited partners, including Delek Holdings, and 2.0% to our general partner (assuming it makes any capital contributions necessary to maintain its 2.0% interest in us).

In addition, if distributions exceed the minimum quarterly distribution and other higher target distribution levels, the general partner may be entitled to increasing percentages of the distributions, up to 48.0% of the distributions above the highest target distribution level.

As of February 19, 2021, Delek Holdings and its affiliates owned 34,745,868 of our common limited partner units, which represents a 80.0% ownership interest in the Partnership.

Certain transactions with Delek Holdings and its affiliated entities are considered to be related party transactions under Item 404 of Regulation S-K because Delek Holdings and its affiliates own more than five percent of our equity interests.

In addition, Messrs.

Yemin, Spiegel and Serff, and Ms.

McWatters serve as executive officers of both Delek Holdings and our general partner.

Distributions and Payments to Delek Holdings

Pursuant to our Partnership Agreement, we are required to make quarterly cash distributions of 100% of our "available cash" to limited partners, including Delek Holdings.

During 2020, we made cash distributions totaling $136.8 million to our unitholders, of which $105.3 million was paid to Delek Holdings and our general partner.

The maximum incentive distribution right of 48% was achieved in 2019 , 2018 and 2017 .

Effective March 1, 2018 , the Partnership, through its wholly-owned subsidiary DKL Big Spring, LLC, acquired certain logistic assets from Delek Holdings, which are primarily located at or adjacent to Delek Holdings' Big Spring Refinery (the "Big Spring Logistic Assets").

The total consideration is subject to certain post-closing adjustments and was approximately $48.0 million in cash.

We financed this acquisition with a combination of cash on hand and borrowings under the DKL Credit Facility (as defined in Note 7).

This transaction is described in greater detail in Note 3 to our consolidated financial statements included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K.

Effective March 31, 2020, the Partnership, through its wholly-owned subsidiary DKL Permian Gathering, LLC, acquired the Big Spring Gathering Assets from Delek Holdings, located in Howard, Borden and Martin Counties, Texas.

The total consideration was subject to certain post-closing adjustments and was comprised of $100.0 million in cash and 5.0 million of our common limited partner units.

We financed the cash component of this acquisition with borrowings from the DKL Credit Facility.

This transaction is described in greater detail in Note 3 to our consolidated financial statements included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K.

Commercial Agreements, Omnibus Agreement and Operations and Management Services Agreement

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See Note 4 to the consolidated financial statements in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K for a discussion of and the amounts paid under our material commercial agreements and other non-contractual arrangements with Delek Holdings during 2020.

For a discussion of a third party's involvement in certain of our agreements, see Item 1.

"Business—Commercial Agreements—Delek Holdings' Crude Oil and Refined Products Supply and Offtake Arrangement."

For a discussion of a third party's involvement in certain of our agreements, see Items 1 and 2.

"Business and Properties—Commercial Agreements—Delek Holdings' Crude Oil and Refined Products Supply and Offtake Arrangement."

Omnibus Agreement

The Omnibus Agreement (as defined in Note 4 to our consolidated financial statements) governs a number of important aspects of the Partnership’s business relationship with Delek Holdings.

For a more extensive summary of this agreement and its amendment history, see Item 1, “Business—Commercial Agreements—Other Agreements with Delek Holdings.” The Omnibus Agreement addresses, among other things, the following matters:

For a more extensive summary of this agreement and its amendment history, see Items 1 and 2.

“Business and Properties—Commercial Agreements—Other Agreements with Delek Holdings.” The Omnibus Agreement addresses, among other things, the following matters:

• an agreement whereby Delek Holdings will not compete with us under certain circumstances;

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• Delek Holdings' reimbursement to us for certain operating expenses and certain maintenance capital expenditures and Delek Holdings' indemnification of us for certain matters, including environmental, title and tax matters;

reimbursement to us for certain designated periods of time related to the date of acquisition of the relevant asset for any operating expenses in excess of certain thresholds per year that we incur for inspections, maintenance and repairs to any of the storage tanks contributed to us by Delek Holdings that are necessary to comply with the DOT pipeline integrity rules and certain API storage tank standards;

• reimbursement to us for certain designated periods of time related to the date of acquisition of the relevant asset for any operating expenses in excess of certain thresholds per year that we incur for inspections, maintenance and repairs to any of the storage tanks

Directors, Executive Officers, Corporate Governance, and Security Ownership

contributed to us by Delek Holdings that are necessary to comply with the DOT pipeline integrity rules and certain API storage tank standards;

• reimbursement to us for certain designated periods of time related to the date of acquisition of the relevant asset for all non-discretionary maintenance capital expenditures, other than those required to comply with applicable environmental laws and regulations, in excess of certain thresholds per year that we make with respect to the assets contributed to us by Delek Holdings for which we have not been reimbursed as described above.

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Other Related Party Transactions

In addition to the agreements described above, we purchased refined product and bulk biofuels from Delek Holdings, totaling $273.7 million and $11.9 million , respectively, during the year ended December 31, 2019 .

In addition to the agreements described above, we purchased refined product from Delek Holdings, totaling $197.8 million during the year ended December 31, 2020.

We sold RINs in the amount of approximately $3.4 million to Delek Holdings during the year ended December 31, 2020.

Directors, Executive Officers, Corporate Governance, and Security Ownership

The Partnership has an $850.0 million senior secured revolving credit agreement with Fifth Third Bank, as administrative agent, and a syndicate of lenders (the "DKL Credit Facility").

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subsidiaries' tangible and intangible assets.

Additionally, Delek Marketing & Supply, LLC ("Delek Marketing") provides a limited guaranty of the Partnership's obligations under the DKL Credit Facility.

Delek Marketing's guaranty is (i) limited to an amount equal to the principal amount, plus unpaid and accrued interest, of a promissory note made by Delek Holdings in favor of Delek Marketing (the "Holdings Note") and (ii) secured by Delek Marketing's pledge of the Holdings Note to our lenders under the DKL Credit Facility.

As of December 31, 2019 , the principal amount of the Holdings Note was $102.0 million , plus unpaid interest accrued since the issuance date.

Additionally, Delek Marketing, a subsidiary of Delek Holdings, had provided a limited guaranty of the Partnership's obligations under the DKL Credit Facility.

Delek Marketing's guaranty was (i) limited to an amount equal to the principal amount, plus unpaid and accrued interest, of a promissory note made by Delek Holdings in favor of Delek Marketing (the "Holdings Note") and (ii) secured by Delek Marketing's pledge of the Holdings Note to the lenders under the DKL Credit Facility.

Effective March 30, 2020, Delek Marketing's limited guaranty and pledge of the Holdings Note was terminated pursuant to a guaranty and pledge release approved by the required lenders under the DKL Credit Facility.

The Partnership currently manages a long-term capital project on behalf of Delek Holdings pursuant to a construction management and operating services agreement (the "DPG Management Agreement") for the construction of a 250-mile gathering system in the Permian Basin (the "Delek Permian Gathering Project").

The Partnership is also considered the operator for the project and is responsible for oversight of the project design, procurement and construction of project segments and providing other related services.

The majority of the gathering system has been constructed, however additional costs pertaining to a pipeline connection that was not contributed to the Partnership continue to be incurred and are still subject to the terms of the DPG Management Agreement.

See Note 4 to the consolidated financial statements in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K, for a discussion of and the amounts paid under the DPG Management Agreement during 2020.

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Additionally, the policy effectively requires that all related party transactions that:

Directors, Executive Officers, Corporate Governance, and Security Ownership

involve the purchase and sale of products or services that are effected at either (x) cost (including, when relevant, a nominal fee for services) or (y) the then-prevailing market prices that we would pay or charge to third parties ("Market Based Transactions") undertaken outside the ordinary course of business and involve an aggregate amount of more than $2.5 million annually;

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Principal Accountant Fees and Services

Audit fees of $694,050 and $677,525 paid for the services of Ernst & Young LLP during fiscal years 2019 and 2018 , respectively, include services related to the audits of our consolidated financial statements and internal controls over financial reporting, reviews of our quarterly

PRINCIPAL ACCOUNTANT FEES AND SERVICES

condensed consolidated financial statements and audit services provided in connection with acquisitions, investments and regulatory filings.

Audit fees of $734,920 and $748,672 paid for the services of Ernst & Young LLP during fiscal years 2020 and 2019, respectively, include services related to the audits of our consolidated financial statements and internal controls over financial reporting, reviews of our quarterly condensed consolidated financial statements and audit services provided in connection with acquisitions, investments and regulatory filings.

Fees and expenses are for services in connection with the audit of our fiscal years ended 2020 and 2019, regardless of when the fees and expenses were paid.

Audit-related fees

Audit-related fees of $54,622 and $81,447 paid for the services of Ernst & Young LLP during fiscal years 2019 and 2018 include procedures for us and our subsidiaries related to acquisition due diligence services.

No audit-related fees were paid for the services of Ernst & Young LLP during fiscal years 2020 and 2019.

Tax Fees and All Other Fees

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2.1 Contribution and Subscription Agreement, dated as of May 24, 2019, by and among Plains Pipeline, L.P., DKL Pipeline, LLC, and Red River Pipeline Company, LLC (incorporated by reference to Exhibit 2.1 to the Partnership's Current Report on Form 8-K filed on May 28, 2019).

2.2 Contribution, Conveyance, and Assumption Agreement, dated as of March 31, 2020, between several Delek subsidiaries (incorporated by reference to Exhibit 2.1 of the Partnership's Form 8-K filed April 6, 2020).

2.3 Throughput and Deficiency Agreement, dated as of March 31, 2020, by and between Lion Oil Trading & Transportation, LLC and DKL Permian Gathering, LLC (incorporated by reference to Exhibit 10.1 of the Partnership's Form 8-K filed on April 6, 2020).

2.4 Exchange Agreement, dated August 13, 2020, between Delek Logistics and Delek Logistics GP, LLC (incorporated by reference to Exhibit 10.2 of the Partnership's Form 8-K filed on August 14, 2020).

3.1 Certificate of Limited Partnership of Delek Logistics Partners, LP (incorporated by reference to Exhibit 3.1 to the Partnership's Form S-1 (File No.

333-182631) filed on July 12, 2012).

First Amended and Restated Agreement of Limited Partnership of Delek Logistics Partners, LP, dated November 7, 2012 (incorporated by reference to Exhibit 3.1 to the Partnership's Form 8-K filed on November 7, 2012, SEC File No.

Amendment No.

1 to the First Amended and Restated Agreement of Limited Partnership of Delek Logistics Partners, LP, dated February 27, 2018 (incorporated by reference to Exhibit 3.2(b) to the Partnership's From 10-K filed on March 1, 2018).

3.2 Second Amended and Restated Agreement of Limited Partnership of Delek Logistics Partners, LP, dated August 13, 2020 (incorporated by reference to Exhibit 3.1 of the Partnership's Form 8-K filed on August 14, 2020).

3.3 Certificate of Formation of Delek Logistics GP, LLC (incorporated by reference to Exhibit 3.3 to the Partnership's Registration Statement on Form S-1 (File No.

333-182631) filed on July 12, 2012).

Third Amended and Restated Limited Liability Company Agreement of Delek Logistics GP, LLC, dated as of December 10, 2013 (incorporated by reference to Exhibit 3.1 to the Partnership’s Form 8-K filed on December 13, 2013).

Indenture, dated as of May 23, 2017, among Delek Logistics, LP, Delek Logistics Finance Corp., the Guarantors named therein and U.S.

3.4 Fourth Amended and Restated Limited Liability Company Agreement of Delek Logistics GP, LLC, dated August 1 3 , 20 2 0 (incorporated by reference to Exhibit 3.

2 of the Partnership’s Form 8-K filed on August 1 4 , 20 20 ).

4.1 # Description of the Common Units.

4.2 Indenture, dated as of May 23, 2017, among Delek Logistics Partners, LP, Delek Logistics Finance Corp., the Guarantors named therein and U.S.

Bank, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Partnership's Form 8-K filed on May 24, 2017).

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Bank, National Association (incorporated by reference to Exhibit 4.1 to the Partnership’s Form 8-K filed on March 26, 2018).

Description of the Common Units.

4.5 Second Supplemental Indenture, dated February 28, 2020, among DKL Pipeline, LLC, Delek Logistics Partners, LP, Delek Logistics Finance Corp., the other guarantors and U.S.

(incorporated by reference to Exhibit 4.1 of the Partnership's Form 8-K filed on April 6, 2020).

4.6 Third Supplemental Indenture, dated March 26, 2020, among DKL Permian Gathering, LLC, Delek Logistics Partners, LP, Delek Logistics Finance Corp., the other guarantors and U.S.

(incorporated by reference to Exhibit 4.2 of the Partnership's Form 8-K filed on April 6, 2020).

10.1 ++ Marketing Agreement, dated November 7, 2012, by and between Delek Refining, Ltd.

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and Delek Marketing-Big Sandy, LLC (incorporated by reference to Exhibit 10.1 to the Partnership’s Form 8-K/A filed on July 31, 2013).

First Amendment to Amended and Restated Services Agreement (Big Sandy Terminal and Pipeline), dated as of December 14, 2018, by and between Delek Refining, LTD and Delek Marketing-Big Sandy.

LLC (incorporated by reference to Exhibit 10.21 to the Partnership's Form 10-K filed on March 1, 2019).

10.16 First Amendment to Amended and Restated Services Agreement (Big Sandy Terminal and Pipeline), dated as of December 14, 2018, by and between Delek Refining, LTD and Delek Marketing-Big Sandy, LLC (incorporated by reference to Exhibit 10.21 to the Partnership's Form 10-K filed on March 1, 2019).

10.17 Pipelines and Storage Facilities Agreement, dated November 7, 2012, by and among Lion Oil Company, Delek Logistics Partners, LP, SALA Gathering Systems, LLC, El Dorado Pipeline Company, LLC, Magnolia Pipeline Company, LLC and J.

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(incorporated by reference to Exhibit 10.3 to the Partnership’s Form 8-K filed on August 1, 2013).

First Amendment to Throughput and Tankage Agreement (Tyler Terminal and Tankage), dated as of December 14, 2018, by and between Delek Refining, LTD., and Delek Marketing & Supply, LP (incorporated by reference to Exhibit 10.29 to the Partnership's Form 10-K filed on March 1, 2019).

10.23 First Amendment to Throughput and Tankage Agreement (Tyler Terminal and Tankage), dated as of December 14, 2018, by and between Delek Refining, LTD.

and Delek Marketing & Supply, LP (incorporated by reference to Exhibit 10.29 to the Partnership's Form 10-K filed on March 1, 2019).

10.24 Amended and Restated Site Services Agreement (Tyler Terminal and Tankage), dated March 31, 2015, by and between Delek Marketing & Supply, LP and Delek Refining, Ltd.

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and DKL Caddo, LLC (incorporated by reference to Exhibit 10.7 to the Partnership’s Form 10-Q filed on May 8, 2015).

Pipelines, Storage and Throughput Facilities Agreement (Big Spring Refinery Logistics Assets and Duncan Terminal), dated March 20, 2018 and effective as of March 1, 2018, by and among Alon USA, LP, DKL Big Spring, LLC, for the limited purposes specified therein, Delek US, and for the limited purposes specified therein, J.

10.29 Pipelines, Storage and Throughput Facilities Agreement (Big Spring Refinery Logistics Assets and Duncan Terminal), dated March 20, 2018 and effective as of March 1, 2018, by and among Alon USA, LP, DKL Big Spring, LLC, for the limited purposes specified therein, Delek US Holdings, Inc., and for the limited purposes specified therein, J.

Aron & Company LLC (incorporated by reference to Exhibit 10.1 to the Partnership’s Form 8-K filed on March 26, 2018).

Big Spring Asphalt Services Agreement, dated March 20, 2018 and effective as of March 1, 2018, by and among Alon USA, LP, DKL Big Spring, LLC, for the limited purposes specified therein, Delek US, and for the limited purposes specified therein, J.

10.30 Big Spring Asphalt Services Agreement, dated March 20, 2018 and effective as of March 1, 2018, by and among Alon USA, LP, DKL Big Spring, LLC, for the limited purposes specified therein, Delek US Holdings, Inc., and for the limited purposes specified therein, J.

Aron & Company LLC (incorporated by reference to Exhibit 10.2 to the Partnership’s Form 8-K filed on March 26, 2018).

Marketing Agreement, dated as of March 20, 2018 and effective as of March 1, 2018, by and among Alon USA, LP, DKL Big Spring, LLC, and for the limited purposes specified therein, Delek US (incorporated by reference to Exhibit 10.3 to the Partnership’s Form 8-K filed on March 26, 2018).

10.31 Marketing Agreement, dated as of March 20, 2018 and effective as of March 1, 2018, by and among Alon USA, LP, DKL Big Spring, LLC, and for the limited purposes specified therein, Delek US Holdings, Inc.

(incorporated by reference to Exhibit 10.3 to the Partnership’s Form 8-K filed on March 26, 2018).

10.32 Third Amended and Restated Credit Agreement, dated as of September 28, 2018, among Delek Logistics Partners, LP and each other borrower referenced therein, as borrowers;

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Bank National Association, Bank Hapoalim B.M., Regions Bank and SunTrust Bank as co-documentation agents (incorporated by reference to Exhibit 10.1 to the Partnership’s Form 8-K filed on October 4, 2018).

10.33 First Amendment to Third Amended and Restated Credit Agreement, dated August 12, 2020, by and among Delek Logistics Partners, LP and each other borrower referenced therein, as borrowers, Fifth Third Bank, N.A., as Administrative Agent, and the Lenders party thereto (incorporated by reference to Exhibit 10.1 of the Partnership's Form 8-K filed on August 14, 2020).

10.34 Second Amendment and Restatement of Schedules to Third Amended and Restated Omnibus Agreement, dated and effective as of May 31, 2020 (incorporated by reference to the Exhibit 10.2 of the Partnership's Form 8-K filed on April 6, 2020).

10.35 Transportation Services Agreement dated May 15, 2020 and effective May 1, 2020, between Delek Refining, Ltd., Lion Oil Company and DKL Transportation, LLC (incorporated by reference to Exhibit 10.1 of the Partnership's Form 8-K filed on May 18, 2020).

10.36 Third Amendment and Restatement to Schedules to Third Amended and Restated Omnibus Agreement, dated and effective as of May 15, 2020 (incorporated by reference to Exhibit 10.2 of the Partnership's Form 8-K filed on May 18, 2020).

21.1 # Subsidiaries of Registrant.

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Report of Independent Registered Public Accounting Firm

To the Unitholders of Delek Logistics LP and

the Board of Directors of Delek Logistics Partners GP, LLC

To the Unitholders of Delek Logistics Partners, LP and

the Board of Directors of Delek Logistics GP, LLC

Opinion on the Financial Statements

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We did not audit the financial statements of Red River Pipeline Company, LLC, an entity in which the Partnership has a 33% interest.

In the consolidated financial statements, the Partnership’s investment in Red River Pipeline Company, LLC is stated at $131.0 million as of December 31, 2019, and the Partnership’s equity in the net income of Red River Pipeline Company, LLC is stated at $8.4 million in 2019.

In the consolidated financial statements, the Partnership’s investment in Red River Pipeline Company, LLC is stated at $141.8 million and $131.0 million as of December 31, 2020 and 2019, respectively, and the Partnership’s equity in the net income of Red River Pipeline Company, LLC is stated at $8.9 million in 2020 and $8.4 million in 2019.

Those statements were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for Red River Pipeline Company, LLC, is based solely on the report of other auditors.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Partnership’s internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 27, 2020 expressed an unqualified opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Partnership’s internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated March 1, 2021 expressed an unqualified opinion thereon.

Basis for Opinion

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We believe that our audits and the report of other auditors provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Presentation and Disclosure of Related Party Transactions

Description of the Matter As described in Note 4 to the consolidated financial statements, the Partnership engages, in the ordinary course of business, in related party transactions with Delek US Holdings, Inc.

and certain of its subsidiaries (collectively “Delek Holdings”).

Auditing the completeness of the related party transactions, and the corresponding presentation and disclosure, was challenging due to Delek Holdings’ involvement in many aspects of the Partnership’s business, including the revenue earned by the Partnership from providing gathering, transportation, storage, marketing and terminalling services under various commercial agreements with Delek Holdings.

Additionally, the Partnership and Delek Holdings have entered into other agreements which govern the provision of certain operational services, reimbursement obligations and fees charged for the provision of centralized corporate services.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls that address the risks of material misstatement related to the Partnership’s process of identifying and disclosing related party transactions, including controls to verify the completeness of related party transactions and disclosures.

To test the completeness of related party transactions, we obtained a listing of all related party relationships and compared the listing to the Delek Holdings’ legal structure and evidence obtained from other audit procedures including, among others, inquiries of management and the audit committee, review of the board of directors and other committee meeting minutes, review of contracts, and testing of revenue and expense transactions.

In addition, to evaluate the presentation and disclosure of related party transactions, we used the related party listing obtained to perform procedures to test material related party account activity and account balances including, among others, testing the related and third-party classification of transactions in revenue, expense and balance sheet accounts by inspecting source documentation and evaluating the aggregation and presentation of related party financial statement line items.

/s/ Ernst & Young LLP

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Nashville, Tennessee

February 27, 2020

March 1, 2021

Report of Independent Registered Public Accounting Firm

To the Unitholders of Delek Logistics, LP and

the Board of Directors of Delek Logistics Partners GP, LLC

To the Unitholders of Delek Logistics Partners, LP and

the Board of Directors of Delek Logistics GP, LLC

Opinion on Internal Control over Financial Reporting

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In our opinion, Delek Logistics Partners, LP (the Partnership) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2020, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of Delek Logistics Partners, LP as of December 31, 2019 and 2018, the related consolidated statements of income and comprehensive income, partners’ equity (deficit) and cash flows for each of the three years in the period ended December 31, 2019, and the related notes, and our report dated February 27, 2020 expressed an unqualified opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of Delek Logistics Partners, LP as of December 31, 2020 and 2019, the related consolidated statements of income and comprehensive income, partners’ equity (deficit) and cash flows for each of the three years in the period ended December 31, 2020, and the related notes, and our report dated March 1, 2021 expressed an unqualified opinion thereon.

Basis for Opinion

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Nashville, Tennessee

February 27, 2020

March 1, 2021

Exhibits and Financial Statement Schedules

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Accounts receivable 15,676 13,204

Accounts receivable from related parties 5,932 —

Inventory 3,127 12,617

Other current assets 331 2,204

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Operating lease right-of-use assets 24,199 3,745

Goodwill 12,203 12,203

Marketing Contract Intangible, net 123,788 130,999

Rights-of-way 36,316 15,597

Other non-current assets 12,115 6,305

Total assets $ 956,417 $ 744,447

LIABILITIES AND DEFICIT

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8,697,468 units issued and outstanding at December 31, 2020 ( 9,131,579 at December 31, 2019)

164,614 164,436

Common unitholders - Delek Holdings;

34,745,868 units issued and outstanding at December 31, 2020 ( 15,294,046 at December 31, 2019)

General partner - 498,482 units issued and outstanding at December 31, 2019 (498,038 at December 31, 2018)

( 272,915 ) ( 310,513 )

General partner - no units issued and outstanding at December 31, 2020 ( 498,482 at December 31, 2019) (1)

Total deficit ( 108,301 ) ( 151,119 )

Total liabilities and deficit $ 956,417 $ 744,447

See accompanying notes to the consolidated financial statements

(1) See Note 4 for a description of the IDR Restructuring Transaction.

See accompanying notes to the consolidated financial statement

Exhibits and Financial Statement Schedules

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Year Ended December 31,

2020 2019 2018

Net revenues:

Affiliate (1)

$ 382,666 $ 261,014 $ 240,809

Third party 180,752 322,978 416,800

Net revenues 563,418 583,992 657,609

Cost of sales:

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Depreciation and amortization 1,994 1,808 1,882

Other operating expense (income), net

Other operating (income) expense, net ( 66 ) 34 891

Total operating costs and expenses 383,625 458,180 531,852

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Income before income tax expense 159,479 97,716 90,716

Income tax expense (benefit)

Income tax expense 223 967 534

Net income attributable to partners $ 159,256 $ 96,749 $ 90,182

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General partner's interest in net income, including incentive distribution rights (2)

18,724 33,080 25,543

Limited partners' interest in net income $ 140,532 $ 63,669 $ 64,639

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(1) See Note 4 for a description of our material affiliate revenue transactions.

(2) See Note 4 for a description of the IDR Restructuring Transaction.

See accompanying notes to the consolidated financial statements

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(in thousands)

Common - Public

Common - Delek Holdings

General Partner - Delek Holdings

Common - Public Common - Delek Holdings General Partner - Delek Holdings Total

Balance at December 31, 2017 $ 174,378 $ ( 197,206 ) $ ( 6,397 ) $ ( 29,225 )

Distributions to Delek Holdings for Big Spring Asset Acquisition — ( 96,822 ) ( 1,976 ) ( 98,798 )

Cash distributions (1)

( 27,721 ) ( 46,417 ) ( 23,698 ) ( 97,836 )

GP Units Issued to maintain 2 % interest

Sponsorship contribution of fixed assets — 151 3 154

Net income attributable to partners 24,119 40,520 25,543 90,182

Delek Holdings unit repurchases from public

Other 247 414 13 674

Balance at December 31, 2018 $ 171,023 $ ( 299,360 ) $ ( 6,486 ) $ ( 134,823 )

Distributions to Delek Holdings for Big Spring Asset Acquisition

Cash distributions (1)

( 30,626 ) ( 51,388 ) ( 31,654 ) ( 113,668 )

GP Units Issued to maintain 2 % interest

Sponsor contribution of fixed assets

Net income attributable to partners 23,813 39,856 33,080 96,749

Other 226 379 10 615

Balance at December 31, 2019 $ 164,436 $ ( 310,513 ) $ ( 5,042 ) $ ( 151,119 )

Cash distributions (1)

( 31,532 ) ( 77,665 ) ( 27,635 ) ( 136,832 )

GP Units Issued to maintain 2 % interest

Net income attributable to partners 36,324 104,208 18,724 159,256

Delek Holdings Unit purchases from public ( 4,979 ) 4,979 — —

Issuance of units in connection with the Big Spring Gathering Assets Acquisition — 107,323 2,190 109,513

Cash Distribution to Delek Holdings for Trucking Assets Acquisition — ( 46,607 ) ( 951 ) ( 47,558 )

Cash distribution to general partner for conversion of its economic interest and IDR elimination — — ( 45,000 ) ( 45,000 )

Conversion of GP economic interest — ( 57,702 ) 57,702 —

Sponsor contribution of fixed assets — 2,938 — 2,938

Other 365 124 2 491

Balance at December 31, 2020 $ 164,614 $ ( 272,915 ) $ — $ ( 108,301 )

(1) Cash distributions include a nominal amount, $ 0.1 million and $ 0.5 million for the years ended December 31, 2019 , 2018 and 2017 , respectively, related to distribution equivalents on vested phantom units.

(1) Cash distributions include a nominal amount for the years ended December 31, 2020 and 2019, respectively, related to distribution equivalents on vested phantom units.

Cash distributions include $ 0.1 million for the year ended December 31, 2018 related to distribution equivalents on vested phantom units.

See accompanying notes to the consolidated financial statements

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Year Ended December 31,

2020 2019 2018

Cash flows from operating activities:

Net income $ 159,256 $ 96,749 $ 90,182

Adjustments to reconcile net income to net cash provided by operating activities:

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Accretion of asset retirement obligations 427 397 359

(Gain) loss on asset disposals

(Gain) loss on disposal of assets ( 66 ) ( 197 ) 891

Deferred income taxes 401 496 152

Income from equity method investments ( 22,693 ) ( 19,832 ) ( 6,230 )

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Cash flows from investing activities:

Asset acquisitions, net of assumed asset retirement obligation liabilities

Asset acquisitions from Delek Holdings, net of assumed liabilities ( 100,527 ) — ( 72,380 )

Purchases of property, plant and equipment ( 13,271 ) ( 9,070 ) ( 12,931 )

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Distributions to common unitholders - Delek Holdings ( 77,665 ) ( 51,388 ) ( 46,417 )

Distributions to Delek Holdings unitholders and general partner related to Big Spring Logistic Assets Acquisition

Distributions to Delek Holdings unitholders and general partner related to Big Spring Logistics Assets Acquisition — — ( 98,798 )

Distributions to Delek Holdings unitholders and general partner related to Trucking Assets Acquisition ( 47,558 ) — —

Distribution to general partner for conversion of its interest and IDR elimination ( 45,000 ) — —

Proceeds from revolving credit facility 599,600 564,700 735,000

Payments on revolving credit facility ( 441,400 ) ( 433,000 ) ( 458,200 )

Proceeds from issuance of senior notes

Deferred financing costs paid — — ( 5,264 )

Net cash provided by (used in) financing activities

Net increase (decrease) in cash and cash equivalents

Net cash (used in) provided by financing activities ( 71,180 ) 18,040 74,928

Net (decrease) increase in cash and cash equivalents ( 1,302 ) 1,023 ( 153 )

Cash and cash equivalents at the beginning of the period 5,545 4,522 4,675

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Year Ended December 31,

2020 2019 2018

Supplemental disclosures of cash flow information:

Cash paid during the period for:

Interest $ 40,582 $ 44,791 $ 38,959

Income taxes $ 98 $ 144 $ 137

Non-cash investing activities:

Increase (decrease) in accrued capital expenditures $ 198 $ 917 $ ( 1,363 )

Equity issuance to Delek Holdings unitholders in connection with Big Spring Gathering Assets Acquisition $ 109,513 $ — $ —

Non-cash financing activities:

Sponsor contribution of fixed assets

Sponsor contribution of property, plant and equipment $ 2,938 $ — $ 154

Non-cash lease liability arising from obtaining right of use assets during the period $ 32,090 $ 1,285 $ —

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("Delek Holdings") and its subsidiary Delek Logistics GP, LLC, our general partner (our "general partner") .

Effective March 1, 2018 , the Partnership, through its wholly-owned subsidiary DKL Big Spring, LLC, acquired from Delek Holdings certain logistics assets primarily located at or adjacent to Delek Holdings' refinery near Big Spring, Texas (the "Big Spring Refinery") and Delek Holdings' light products distribution terminal located in Stephens County, Oklahoma (collectively, the "Big Spring Logistic Assets" and such transaction the "Big Spring Logistic Assets Acquisition").

See Note 3 for further information regarding the Big Spring Logistic Assets Acquisition.

Effective August 13, 2020, the Partnership closed the transaction contemplated by a definitive exchange agreement with the general partner to eliminate all of the incentive distribution rights ("IDRs") held by the general partner and convert the 2.0 % economic general partner interest into a non-economic general partner interest, all in exchange for 14.0 million newly issued common limited partner units and $ 45.0 million in cash ("IDR Restructuring Transaction").

Contemporaneously, Delek Holdings purchased a 5.2 % ownership interest in our general partner from certain affiliates, who were also members of our general partner's management and board of directors.

See Note 4 of the accompanying consolidated financial statements for further information.

Effective May 1, 2020, the Partnership, through its wholly-owned subsidiary DKL Transportation, LLC, acquired Delek Trucking, LLC consisting of certain leased and owned tractors and trailers and related assets (the "Trucking Assets") from Delek Holdings, such transaction the "Trucking Assets Acquisition." See Note 3 of the accompanying consolidated financial statements for further information.

Effective March 31, 2020, the Partnership, through its wholly-owned subsidiary DKL Permian Gathering, LLC, acquired from Delek Holdings a crude oil gathering system located in Howard, Borden and Martin Counties, Texas (the "Big Spring Gathering Assets"), and certain related assets, such transaction the "Big Spring Gathering Assets Acquisition." See Note 3 of the accompanying consolidated financial statements for further information.

Effective March 1, 2018, the Partnership, through its wholly-owned subsidiary DKL Big Spring, LLC, acquired from Delek Holdings certain logistics assets primarily located at or adjacent to Delek Holdings' refinery near Big Spring, Texas (the "Big Spring Refinery") and Delek Holdings' light products distribution terminal located in Stephens County, Oklahoma (collectively, the "Big Spring Logistics Assets" and such transaction the "Big Spring Logistics Assets Acquisition").

See Note 3 of the accompanying consolidated financial statements for further information regarding the Big Spring Logistics Assets Acquisition.

Description of Business

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A substantial majority of our existing assets are both integral to and dependent upon the success of Delek Holdings' refining operations, as many of our assets are contracted exclusively to Delek Holdings in support of its Tyler, El Dorado and Big Spring refineries.

The Partnership generates revenue by charging fees to Delek Holdings and third parties for gathering, transporting, offloading and storing crude oil and for marketing, distributing, transporting, throughputting and storing intermediate and refined products.

We also wholesale market refined products primarily in the West Texas market.

A substantial majority of our contribution margin, which we define as net revenues less cost of materials and other and operating expenses, excluding depreciation and amortization, is derived from commercial agreements with Delek Holdings with initial terms ranging from five to ten years , which gives us a contractual revenue base that we believe enhances the stability of our cash flows.

The Partnership is not a taxable entity for federal income tax purposes or the income taxes of those states that follow the federal income tax treatment of partnerships.

Instead, for purposes of such income taxes, each partner of the Partnership is required to take into account its share of items of income, gain, loss and deduction in computing its federal and state income tax liabilities, regardless of whether cash distributions are made to such partner by the Partnership.

The taxable income reportable to each partner takes into account differences between the tax basis and the fair market value of our assets and financial reporting bases of assets and liabilities, the acquisition price of the partner's units and the taxable income allocation requirements under the Partnership's Second Amended and Restated Agreement of Limited Partnership (the "Partnership Agreement").

Accounting Policies

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The preparation of our financial statements in conformity with U.S.

generally accepted accounting principles (“GAAP”) and in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Notes to Consolidated Financial Statements

financial statements and the reported amounts of revenues and expenses during the reporting period.

Actual results could differ from those estimates.

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Certain immaterial reclassifications have been made to prior period presentation in order to conform to the current year presentation.

Risks and Uncertainties Arising from the COVID-19 Pandemic

The outbreak of COVID-19 and its development into a pandemic in March 2020 (the "COVID-19 Pandemic") has resulted in significant economic disruption globally, including in the U.S.

and specific geographic areas where we operate.

Actions taken by various governmental authorities, individuals and companies around the world to prevent the spread of COVID-19 through social distancing have restricted travel, many business operations, public gatherings and the overall level of individual movement and in-person interaction across the globe.

This has in turn significantly reduced global economic activity and resulted in airlines dramatically cutting back on flights and a decrease in motor vehicle use.

As a result, there has also been a decline in the demand for, and thus also the market prices of, crude oil and certain products, particularly refined petroleum products that we receive revenue for the transportation and storage services we provide.

In addition, the decline in demand impacted the sales volumes in our wholesale marketing business.

As of December 31, 2020, there is continued uncertainty about the duration and future impact of the COVID-19 Pandemic.

Therefore, downward pressure on commodity prices has remained and could continue for the foreseeable future.

Uncertainties related to the impact of the COVID-19 Pandemic and other events exist that could impact our future results of operations and financial position, the nature of which and the extent to which are currently unknown.

To the extent these uncertainties have been identified and are believed to have an impact on our current period results of operations or financial position based on the requirements for assessing such financial statement impact under GAAP, we have considered them in the preparation of our financial statements as of and for the year ended December 31, 2020.

The application of accounting policies impacted by such considerations include (but are not necessarily limited to) the following:

• The evaluation of indefinite-lived intangibles and goodwill for potential impairment, during our annual assessment or where indicators exist, as defined by GAAP;

• The evaluation of long-lived assets for potential impairment, where indicators exist, as defined by GAAP;

• The evaluation of joint ventures for potential impairment, where indicators exist, as defined by GAAP;

• The evaluation of inventory valuation allowances that may be warranted under the lower of cost or net realizable value analysis, pursuant to GAAP;

• The consideration of debt modifications and or covenant requirements, as applicable;

• The evaluation of commitments and contingencies, including changes in concentrations, as applicable;

• The evaluation of the risk of credit losses and the determination of our allowance for credit losses, pursuant to GAAP;

• The evaluation of our ability to continue as a going concern.

Segment Reporting

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• The assets and investments reported in the pipeline and transportation segment provide crude oil gathering and crude oil, intermediate and refined products transportation and storage services to Delek Holdings' refining operations and independent third parties.

Notes to Consolidated Financial Statements

• The wholesale marketing and terminalling segment provides marketing services for the refined products output of the Delek Holdings' refineries, engages in wholesale activity at our terminals and terminals owned by third parties, whereby we purchase light product for sale and exchange to third parties, and provides terminalling services at our refined products terminals to independent third parties and Delek Holdings.

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Segment reporting is more fully discussed in Note 15.

Notes to Consolidated Financial Statements

Cash and Cash Equivalents

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Accordingly, no allowance for doubtful accounts has been established as of December 31, 2020 and 2019.

One third-party customer accounted for approximately 52.5 % of the consolidated accounts receivable balance as of December 31, 2019 .

Two third-party customers accounted for approximately 50.4 % of the consolidated accounts receivable balance as of December 31, 2018 .

One third-party customer accounted for approximately 49.9 % and 52.5 % of the consolidated accounts receivable balance as of December 31, 2020 and December 31, 2019, respectively.

Inventory consists of refined products, which are stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out ("FIFO") basis .

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The marketing contract intangible is amortized on a straight-line basis over a 20 year period as a component of net revenues from affiliates.

Acquired intangible assets determined to have an indefinite useful life are not amortized, but are tested for impairment in connection with our evaluation of long-lived assets as events and circumnstances indicate that the assets might be impaired.

Property, Plant and Equipment and Intangibles Impairment

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In accordance with ASC 360, Property, Plant and Equipment and ASC 350, Intangibles - Goodwill and Other , we evaluate the realizability of these long-lived assets as events occur that might indicate potential impairment.

In doing so, we assess whether the carrying amount of the asset is unrecoverable by estimating the sum of the future cash flows expected to result from the use of the asset, undiscounted and without interest charges.

In doing so, we assess whether the carrying amount of the asset is recoverable by estimating the sum of the future cash flows expected to result from the use of the asset, undiscounted and without interest charges.

If the carrying amount is more than the recoverable amount, an impairment charge must be recognized based on the fair value of the asset.

Notes to Consolidated Financial Statements

Goodwill and Potential Impairment

Goodwill in an acquisition represents the excess of the aggregate purchase price over the fair value of the identifiable net assets.

Goodwill is reviewed at least annually for impairment, or more frequently if indicators of impairment exist, such as disruptions in our business, unexpected significant declines in operating results, or a sustained market capitalization decline.

Goodwill is reviewed at least annually during the fourth quarter for impairment, or more frequently if indicators of impairment exist, such as disruptions in our business, unexpected significant declines in operating results or a sustained market capitalization decline.

Goodwill is evaluated for impairment by comparing the carrying amount of the reporting unit to its estimated fair value.

The Partnership adopted Accounting Standard Update ("ASU") 2017-04, Goodwill and Other (Topic 350);

The Company adopted ASU 2017-04, Goodwill and Other (Topic 350);

Simplifying the Test for Goodwill Impairment , during the fourth quarter of 2018.

In accordance with this guidance, if a reporting unit's carrying amount exceeds its fair value, the impairment assessment leads to the testing of the implied fair value of the reporting unit's goodwill to its carrying amount if the implied fair value is less than the carrying amount, a goodwill impairment charge is recorded.

In accordance with this guidance, a goodwill impairment charge is recognized for the amount that the carrying amount of a reporting unit, including

Notes to Consolidated Financial Statements

goodwill, exceeds its fair value, limited to the total amount of goodwill allocated to that reporting unit.

In assessing the recoverability of goodwill, assumptions are made with respect to future business conditions and estimated expected future cash flows to determine the fair value of a reporting unit.

We may consider inputs such as a market participant weighted average cost of capital, estimated growth rates for revenue, gross profit and capital expenditures based on history and our best estimate of future forecasts, all of which are subject to significant judgment and estimates.

We may also estimate the fair values of the reporting units using a multiple of expected future cash flows, such as those used by market participants.

If these estimates and assumptions change in the future, due to factors such as a decline in general economic conditions, competitive pressures on sales and margins and other economic and industry factors beyond management's control, an impairment charge may be required.

A significant risk to our future results and the potential future impairment of goodwill is the volatility of the crude oil and the refined product markets which is often unpredictable and may negatively impact our results of operations in ways that cannot be anticipated and that are beyond management's control.

We may also elect to perform a qualitative assessment of goodwill balances.

The qualitative assessment permits companies to assess whether it is more likely than not (i.e., a likelihood of greater than 50%) that the fair value of a reporting unit is less than its carrying amount.

If a company concludes based on the qualitative assessment that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the company is required to perform the quantitative impairment test.

If a company concludes based on the qualitative assessment that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, it has completed its goodwill impairment test and does not need to perform the quantitative impairment test.

We elected to perform a qualitative assessment for purposes of our annual goodwill impairment test during the fourth quarter in 2020, 2019 and 2018.

Our annual assessment of goodwill did not result in an impairment charge during the years ended December 31, 2020, 2019 or 2018.

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Equity investments for which we determine we have significant influence are accounted for as equity method investments.

Amounts recognized for equity method investments are included in equity method investments in our consolidated balance sheets and adjusted for our share of the net earnings and losses of the investee and cash distributions, which are separately stated in our consolidated statements of income and comprehensive income and our consolidated statements of cash flows.

Amounts recognized for equity method investments are included in equity method investments in our consolidated balance sheets and adjusted for our share of the net earnings and losses of the investee, dividends received and cash distributions from the investee, which are separately stated in our consolidated statements of income and comprehensive income and our consolidated statements of cash flows.

We evaluate our equity method investments presented for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may be impaired.

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It is our policy to accrue environmental and clean-up related costs of a non-capital nature when it is both probable that a liability has been incurred and the amount can be reasonably estimated.

Environmental liabilities represent the current estimated costs to investigate and remediate contamination at our properties.

This estimate is based on internal and third-party assessments of the extent of the contamination, the selected remediation technology and review of applicable environmental regulations, typically considering estimated activities and costs for the next 15 years, unless a specific longer range estimate is practicable.

Accruals for estimated costs from environmental remediation

Notes to Consolidated Financial Statements

obligations generally are recognized no later than completion of the remedial feasibility study and include, but are not limited to, costs to perform remedial actions and costs of machinery and equipment that are dedicated to the remedial actions and that does not have an alternative use.

Environmental liabilities represent the current estimated costs to investigate and remediate contamination at sites where we have environmental exposure.

This estimate is based on assessments of the extent of the contamination, the selected remediation technology and review of applicable environmental regulations, typically considering estimated activities and costs for 15 years, and up to 30 years if a longer period is believed reasonably necessary.

Such estimates may require judgment with respect to costs, time frame and extent of required remedial and clean-up activities.

Accruals for estimated costs from environmental remediation obligations generally are recognized no later than completion of the remedial feasibility study and include, but are not limited to, costs to perform remedial actions and costs of machinery and equipment that are dedicated to the remedial actions and that do not have an alternative use.

Such accruals are adjusted as further information develops or circumstances change.

We discount environmental liabilities to their present value if payments are fixed and determinable.

We discount environmental liabilities to their present value if payments are fixed or reliably determinable.

Expenditures for equipment necessary for environmental issues relating to ongoing operations are capitalized.

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The reconciliation of the beginning and ending carrying amounts of asset retirement obligations as of December 31, 2020 and 2019 is as follows (in thousands):

Notes to Consolidated Financial Statements

Beginning balance $ 5,588 $ 5,191

Liabilities acquired

Accretion expense 427 397

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The Partnership recognizes revenue when it satisfies a performance obligation by transferring control over a product or by providing services to a customer.

The adoption of ASC 606, Revenue from Contracts with Customers ("ASC 606") beginning January 1, 2018, did not materially change our revenue recognition patterns, which are described below.

The principles for recognizing revenue as codified in ASC 605, Revenue Recognition ("ASC 605"), were applied during the years ended December 31, 2017 .

No restatements to revenues or expenses were required to be made to our consolidated statements of income, as we applied the modified retrospective transition method in adopting ASC 606.

Service, Product and Lease Revenues.

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Service revenues are recognized as crude oil, intermediate and refined products are shipped through, delivered by or stored in our pipelines, trucks, terminals and storage facility assets, as applicable.

We do not recognize product revenues for these services, as the product does not represent a promised good in the context of ASC 606.

We do not recognize product revenues for these services, as the product does not represent a promised good in the context of ASC 606, Revenue from Contracts with Customers ("ASC 606").

All service revenues are based on regulated tariff rates or contractual rates.

Payment terms require customers to pay shortly after delivery and do not contain significant financing components.

Certain agreements for gathering, transportation, storage, terminalling, and offloading with Delek Holdings are considered operating leases under ASC 840, Leases ("ASC 840").

As part of the adoption, we applied the permitted practical expedient to not separate lease and non-lease components under the predominance principle to designated asset classes associated with the provision of logistics services.

Certain agreements for gathering, transportation, storage, terminalling, and offloading with Delek Holdings were considered operating leases under ASC 840, Leases ("ASC 840").

As part of the adoption of ASC 842, we applied the permitted practical expedient to not separate lease and non-lease components under the predominance principle to designated asset classes associated with the provision of logistics services.

We have determined that the predominant component of the related agreements currently in effect is the lease component.

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Revenues Related to Reimbursements.

In addition to the agreements noted above, we have cost reimbursement provisions in certain of our agreements with Delek Holdings that provide for reimbursement by the Company for certain costs, including certain capital expenditures.

In addition to the agreements noted above, we have cost reimbursement provisions in certain of our agreements with Delek Holdings that provide for reimbursement to the Company for certain costs, including certain capital expenditures.

Such reimbursements are recorded in other long-term liabilities and are amortized to revenue over the life of the underlying revenue agreement corresponding to the asset.

Notes to Consolidated Financial Statements

Cost of Materials and Other and Operating Expenses

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Operating expenses related to the wholesale business are excluded from cost of sales because they primarily relate to costs associated with selling the products through our wholesale business.

Depreciation and amortization is separately presented in our statement of income and disclosed by reportable segment in Note 15 .

Depreciation and amortization is separately presented in our consolidated statement of income and disclosed by reportable segment in Note 15.

Deferred Financing Costs

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These amounts are amortized ratably over the remaining term of the respective financing and are included in interest expense in the accompanying consolidated statements of income and comprehensive income.

Operating Leases

Notes to Consolidated Financial Statements

In accordance with ASC 842-20, Leases - Lessee ("ASC 842-20"), we classify leases with contractual terms longer than twelve months as either operating or finance.

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Instead, for purposes of these income taxes, each partner of the Partnership is required to take into account its share of items of income, gain, loss and deduction in computing its federal and state income tax liabilities, regardless of whether cash distributions are made to such partner by the Partnership.

The taxable income reportable to each partner takes into account differences between the tax basis and fair market value of our assets and financial reporting bases of assets and liabilities, the acquisition price of such partner's units and the taxable income allocation requirements under the Partnership's First Amended and Restated Agreement of Limited Partnership, as amended (the "Partnership Agreement").

The taxable income reportable to each partner takes into account differences between the tax basis and fair market value of our assets and financial reporting bases of assets and liabilities, the acquisition price of such partner's units and the taxable income allocation requirements under the Partnership's Second Amended and Restated Agreement of Limited Partnership, as amended (the "Partnership Agreement").

We are subject to income taxes in certain states that do not follow the federal tax treatment of Partnerships.

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The Partnership is subject to routine audits by taxing jurisdictions .

Notes to Consolidated Financial Statements

Equity Based Compensation

Our general partner provides equity-based compensation to officers, directors and employees of our general partner or its affiliates, and certain consultants, affiliates of our general partner or other individuals who perform services for us, which includes unit options, restricted units, phantom units, unit appreciation rights, distribution equivalent rights, other unit-based awards and unit awards.

Our general partner provides equity-based compensation to officers, directors and employees of our general partner or its affiliates, and certain consultants, affiliates of our general partner or other individuals who perform services for us, which may include unit options, restricted units, phantom units, unit appreciation rights, distribution equivalent rights, other unit-based awards and unit awards.

The fair value of our phantom units is determined based on the closing market price of our common units on the grant date.

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Net Income per Limited Partner Unit

We use the two-class method when calculating the net income per unit applicable to limited partners because we have more than one participating class of securities.

Our participating securities consist of common units, general partner units and incentive distribution rights ("IDRs").

The two-class method is based on the weighted-average number of common units outstanding during the period.

Basic net income per unit applicable to limited partners is computed by dividing limited partners’ interest in net income, after deducting our general partner’s 2 % interest and IDRs, by the weighted-average number of outstanding common units.

Our net income is allocated to our general partner and limited partners in accordance with their respective partnership percentages after giving effect to priority income allocations for IDRs to our general partner, which is the holder of the IDRs pursuant to our Partnership Agreement.

See Notes 6 and 12 for further discussion.

Basic net income per unit applicable to limited partners is computed by dividing limited partners’ interest in net income by the weighted-average number of outstanding common units.

Prior to August 13, 2020, we had more than one class of participating securities and used the two class method to calculate the net income per unit applicable to the limited partners.

The classes of participating units prior to August 13, 2020 consisted of limited partner units, general partner units and IDRs.

Pursuant to the IDR Restructuring Transaction, the IDRs were eliminated and the 2.0 % general partner economic interest was converted to a non-economic general partner interest.

Effective August 13, 2020, the common limited partner units are the only participating security for cash distributions.

Refer to Notes 6 and 12 for further discussion.

Diluted net income per unit applicable to common limited partners includes the effects of potentially dilutive units on our common units.

As of December 31, 2020, the only potentially dilutive units outstanding consist of unvested phantom units.

Notes to Consolidated Financial Statements

Comprehensive Income

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Sales, Use and Excise Taxes

Prior to the adoption of ASC 606, the Partnership's policy was to exclude sales, use and excise taxes from revenue when we are an agent of the taxing authority, in accordance with the applicable guidance in ASC 605.

Upon the adoption of ASC 606, we made the accounting policy election to exclude from revenue all taxes assessed by a governmental authority, including sales, use and excise taxes, that are both imposed on and concurrent with a specific revenue-producing transaction and collected on behalf of a customer.

The Partnership's policy is to exclude from revenue all taxes assessed by a governmental authority, including sales, use and excise taxes, that are both imposed on and concurrent with a specific revenue-producing transaction and collected on behalf of a customer.

New Accounting Pronouncements Adopted During 2020

ASU 2016-02, Leases

In February 2016, the Financial Accounting Standards Board (the "FASB") issued guidance that requires the recognition of a lease liability and a right-of-use asset, initially measured at the present value of the lease payments, in the statement of financial condition for all leases with terms longer than one year.

The guidance was subsequently amended to consider the impact of practical expedients and provide additional clarifications.

The guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.

We adopted the new lease standard on January 1, 2019.

We elected the package of practical expedients which, among other things, allows us to carry forward the historical lease classification.

For certain lease classes, we have elected the practical expedient not to separate lease and non-lease components, which allows us to combine the components if certain criteria are met.

Further, we elected the optional transition method, which allows us to recognize a cumulative-effect adjustment to the opening balance sheet of retained earnings at the date of adoption and to not recast our comparative periods.

We have not elected the hindsight practical expedients, which would have allowed us to use hindsight in determining the reasonably certain lease term.

The adoption of the lease accounting guidance had no impact on January 1, 2019 partners' equity and resulted in the recognition of a $ 2.7 million lease liability and a corresponding right-of-use asset on our consolidated balance sheet.

The adoption did not have a material impact on our consolidated statement of income.

See Note 18 for further information.

New Accounting Pronouncements Not Yet Adopted

ASU 2019-12, Simplifying the Accounting for Income Taxes

In December 2019, the FASB issued guidance intended to simplify various aspects related to accounting for income taxes, eliminate certain exceptions within ASC 740 and clarify certain aspects of the current guidance to promote consistency among reporting entities.

The pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted.

We expect to adopt this guidance on the effective date and are currently evaluating the impact that adopting this new guidance will have on our business, financial condition and results of operations.

ASU 2018-15, Intangible - Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract

In August 2018, the FASB issued guidance related to customers’ accounting for implementation costs incurred in a cloud computing arrangement that is considered a service contract.

This pronouncement aligns the requirements for capitalizing implementation costs in such arrangements

Notes to Consolidated Financial Statements

with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software.

This pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019.

Early adoption is permitted, including adoption in any interim period for which financial statements have not been issued.

Entities can choose to adopt the new guidance prospectively or retrospectively.

We expect to adopt this guidance prospectively on the effective date and are currently evaluating the impact that adopting this new guidance will have on our business, financial condition and results of operations.

ASU 2018-13, Fair Value Measurement - Changes to the Disclosure Requirements for Fair Value Measurement

In August 2018, the FASB issued guidance related to disclosure requirements for fair value measurements.

In August 2018, the Financial Accounting Standards Board (the "FASB") issued guidance related to disclosure requirements for fair value measurements.

The pronouncement eliminates, modifies and adds disclosure requirements for fair value measurements.

The pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted.

We expect to adopt this guidance on the effective date and do not expect adopting this new guidance will have a material impact on our business, financial condition or results of operations.

The pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019.

We adopted this guidance on January 1, 2020 and the adoption did not have a material impact on our business, financial condition or results of operations.

ASU 2016-13, Financial Instruments - Measurement of Credit Losses on Financial Instruments

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Organizations will now use forward-looking information to better inform their credit loss estimates.

We are currently evaluating the impact that adopting this new guidance will have on our business, financial condition and results of operations, which includes scoping, accounting, and disclosure considerations and historical analysis of applicable assets.

The new guidance will be effective beginning with the first quarter of 2020 and will not have a material impact on our business, financial condition or results of operations.

Big Spring Logistic Assets Acquisition

Effective March 1, 2018 , the Partnership, through its wholly-owned subsidiary DKL Big Spring, LLC, acquired the Big Spring Logistic Assets from Delek Holdings, which are primarily located at or adjacent to the Big Spring Refinery.

This guidance is effective for interim and annual periods beginning after December 15, 2019.

We adopted this guidance on January 1, 2020 using the modified retrospective approach as of the adoption date.

The adoption did not have a material impact on the Partnership’s operating results, financial position or disclosures.

ASU 2018-15, Intangible - Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract

In August 2018, the FASB issued guidance related to customers' accounting for implementation costs incurred in a cloud computing arrangement that is considered a service contract.

This pronouncement aligns the requirements for capitalizing implementation costs in such arrangements with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software.

This pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2019.

Entities can choose to adopt the new guidance prospectively or retrospectively.

We adopted this guidance on January 1, 2020 and elected the prospective method.

The adoption did not have a material impact on the Partnership's financial condition or results of operations.

New Accounting Pronouncements Not Yet Adopted

ASU 2019-12, Simplifying the Accounting for Income Taxes

In December 2019, the FASB issued guidance which is intended to simplify various aspects related to accounting for income taxes, eliminate certain exceptions within Accounting Standard Codification ("ASC") 740 and clarify certain aspects of the current guidance to promote consistency among reporting entities.

The pronouncement is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2020.

We expect to adopt this guidance on the effective date and do not expect adopting this new guidance will have a material impact on our business, financial condition and results of operations.

ASU 2020-01, Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815

In January 2020, the FASB issued ASU 2020-01 which is intended to clarify interactions between the guidance to account for certain equity securities under Topics 321, 323 and 815, and improve current GAAP by reducing diversity in practice and increasing comparability of accounting.

The pronouncement is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2020.

We expect to adopt this guidance on the effective date and do not expect adopting this new guidance will have a material impact on our business, financial condition and results of operations.

ASU 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting (Topic 848)

In March 2020, the FASB issued an amendment which is intended to provide temporary optional expedients and exceptions to GAAP guidance on contracts, hedge accounting and other transactions affected by the expected market transition from the London Interbank Offered Rate (LIBOR) and other interbank rates.

This guidance is effective for all entities any time beginning on March 12, 2020 through December 31, 2022 and may be applied from the beginning of an interim period that includes the issuance date of the ASU.

The Partnership is currently evaluating the impact this guidance may have on its consolidated financial statements and related disclosures.

Trucking Assets Acquisition

The total consideration was approximately $ 48.0 million in cash.

We financed this acquisition with a combination of cash on hand and borrowings under the DKL Credit Facility (as defined in Note 7).

The Trucking Assets are recorded in our pipelines and transportation segment and include approximately 150 trucks and trailers, which are primarily leased or owned, respectively.

In connection with the closing of the transaction, Delek Holdings, the Partnership and various of their respective subsidiaries entered into a Transportation Services Agreement (the “Trucking Assets TSA Agreement”).

Under the Trucking Assets TSA Agreement, the Partnership will gather, coordinate pickup of, transport and deliver petroleum products for Delek Holdings, as well as provide ancillary services as requested.

The transaction and related agreements were approved by the Conflicts Committee of the Partnership's general partner, which is comprised solely of independent directors.

See Note 3 for more detailed descriptions of these agreements.

The Trucking Assets Acquisition was considered a transaction between entities under common control.

Accordingly, the Trucking Assets were recorded at amounts based on Delek Holdings' historical carrying value as of the acquisition date.

The carrying value of the Trucking Assets as of the acquisition date was $ 13.3 million, consisting of $ 0.5 million of owned assets and $ 12.8 million Right of Use asset for leased assets.

The Right of Use asset offsets with an equivalent operating lease liability.

Prior periods have not been recast as these assets do not constitute a business in accordance with Accounting Standard Update 2017-01, Clarifying the Definition of a Business ("ASU 2017-01").

We capitalized approximately $ 0.3 million of acquisition costs related to the Trucking Assets Acquisition.

Big Spring Gathering Assets Acquisition

The total consideration was subject to certain post-closing adjustments and was comprised of $ 100.0 million in cash and 5.0 million of our common limited partner units (the "Additional Units").

We financed the cash component of this acquisition with borrowings from the DKL Credit Facility.

The Big Spring Gathering Assets are recorded in our pipelines and transportation segment and include:

• Crude oil pipelines;

• Approximately 200 miles of gathering systems;

• Approximately 65 Tank battery connections;

• Terminals (total storage of approximately 650,000 bbls);

• Applicable rights-of-way.

In connection with the closing of the transaction, Delek Holdings, the Partnership and various of their respective subsidiaries entered into a Throughput and Deficiency Agreement (the “Big Spring T&D Agreement”).

Under the Big Spring T&D Agreement, the Partnership will operate and maintain the Big Spring Gathering Assets connecting Delek Holdings' interests in and to certain crude oil with the Partnership's Big Spring, Texas terminal and provide gathering, transportation and other related services with respect to any and all crude produced from shipper’s and certain other producers’ respective interests for delivery at the Big Spring Terminal.

The transaction and related agreements were approved by the Conflicts Committee of the Partnership's general partner, which is comprised solely of independent directors.

See Note 3 for more detailed descriptions of these agreements.

The Big Spring Gathering Assets Acquisition was considered a transaction between entities under common control.

Accordingly, the Big Spring Gathering Assets were recorded at amounts based on Delek Holdings' historical carrying value as of the acquisition date.

The carrying value of the Big Spring Gathering Assets as of the acquisition date was $ 209.5 million.

Pursuant to the common control guidance, the 5.0 million units issued (which had a closing market price of $ 9.10 per unit on the transaction date) were recorded in equity at $ 109.5 million, representing the net carrying value of the Big Spring Gathering Assets purchased of $ 209.5 million less the $ 100.0 million cash consideration.

Prior periods have not been recast as these assets do not constitute a business in accordance with ASU 2017-01.

We capitalized approximately $ 0.7 million of acquisition costs related to the Big Spring Gathering Assets Acquisition.

Big Spring Logistics Assets Acquisition

Effective March 1, 2018, the Partnership, through its wholly-owned subsidiary DKL Big Spring, LLC, acquired the Big Spring Logistics Assets from Delek Holdings, which are primarily located at or adjacent to the Big Spring Refinery.

The total purchase price was $ 170.8 million, financed through borrowings under the Partnership’s revolving credit facility.

The Big Spring Logistic Assets include (i) approximately 70 storage tanks and certain ancillary assets (such as tank pumps and piping) primarily located adjacent to the Big Spring Refinery, (ii) an asphalt terminal and a light products terminal, (iii) certain crude oil and refined product pipelines and (iv) other logistics assets, such as four underground saltwells used for natural gas liquids storage.

The Big Spring Logistics Assets include (i) approximately 70 storage tanks and certain ancillary assets (such as tank pumps and piping) primarily located adjacent to the Big Spring

Refinery, (ii) an asphalt terminal and a light products terminal, (iii) certain crude oil and refined product pipelines and (iv) other logistics assets, such as 4 underground saltwells used for natural gas liquids storage.

In connection with the closing of the transaction, Delek Holdings, the Partnership and various of their respective subsidiaries entered into and amended certain existing contracts, including entering into new pipelines, storage and throughput facilities and asphalt services agreements.

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See Note 4 for more detailed descriptions of these agreements.

The Big Spring Logistic Assets Acquisition was considered a transaction between entities under common control.

Accordingly, the Big Spring Logistic Assets were recorded at amounts based on Delek Holdings' historical carrying value as of the acquisition date.

The Big Spring Logistics Assets Acquisition was considered a transaction between entities under common control.

Accordingly, the Big Spring Logistics Assets were recorded at amounts based on Delek Holdings' historical carrying value as of the acquisition date.

The excess of the cash paid over the historical carrying value of the assets acquired from Delek Holdings amounted to $ 98.8 million and was recorded as a reduction in equity.

The historical carrying value of the Big Spring Logistic Assets as of the acquisition date was $ 72.0 million , which is net of $ 0.8 million of assumed asset retirement obligations.

Prior periods have not been recast, as these assets did not constitute a business in accordance with Accounting Standard Update 2017-01 ("ASU 2017-01"), " Clarifying the Definition of a Business ".

We capitalized approximately $ 0.4 million of acquisition costs related to the Big Spring Logistic Assets Acquisition during the year ended December 31, 2018 .

The historical carrying value of the Big Spring Logistics Assets as of the acquisition date was $ 72.0 million, which is net of $ 0.8 million of assumed asset retirement obligations.

Prior periods have not been recast, as these assets did not constitute a business in accordance with ASU 2017-01.

We capitalized approximately $ 0.4 million of acquisition costs related to the Big Spring Logistics Assets Acquisition.

Marketing Contract Intangible Acquisition

Additionally, concurrent with the Big Spring Logistic Assets Acquisition, Delek Holdings, the Partnership and various of their respective subsidiaries entered into a new marketing agreement, whereby the Partnership markets certain refined products produced at or sold from the Big Spring Refinery to various customers in return for a marketing fee (the "Marketing Contract Intangible Acquisition").

Additionally, concurrent with the Big Spring Logistics Assets Acquisition, Delek Holdings, the Partnership and various of their respective subsidiaries entered into a new marketing agreement, whereby the Partnership markets certain refined products produced at or sold from the Big Spring Refinery to various customers in return for a marketing fee (the "Marketing Contract Intangible Acquisition").

We recorded a related contract intangible asset in the amount of $ 144.2 million based on the amount paid to enter into the contract, which represents the fair value of the intangible asset.

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See Note 4 for a more detailed description of this marketing agreement.

Big Spring Acquisition

On September 15, 2017 , the Partnership, through its wholly owned subsidiary, Delek Marketing & Supply, LP acquired from Plains Pipeline, L.P.

an approximate 40 -mile pipeline and related ancillary assets (the "Big Spring Pipeline") (such transaction, the "Big Spring Acquisition") for approximately $ 9.0 million to complement our existing asset base.

The Big Spring Pipeline originates in Big Spring, Texas and terminates in Midland, Texas.

The Big Spring Acquisition was accounted for as an asset acquisition.

The allocation of the relative fair value assigned to property, plant and equipment and intangible assets amounted to $ 6.4 million and $ 2.6 million , respectively.

Intangible assets acquired represent rights-of-way assets with indefinite useful lives.

Rights-of-way assets are not subject to amortization.

Related Party Transactions

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In most circumstances, if Delek Holdings or the applicable third party assignee fails to meet or exceed the minimum volume or throughput commitment during any calendar quarter, Delek Holdings, and not any third party assignee, will be required to make a quarterly shortfall payment to us equal to the volume of the shortfall multiplied by the applicable fee, subject to certain exceptions as specified in the applicable agreement.

Carry-over of any volumes or revenue in excess of such commitment to any subsequent quarter is not permitted.

With the exception of the Big Spring T&D Agreement executed in March 2020, carry-over of any volumes or revenue in excess of such commitment to any subsequent quarter is not permitted.

Under each of these agreements, we are required to maintain the capabilities of our pipelines and terminals, such that Delek Holdings may throughput and/or store, as the case may be, specified volumes of crude oil, intermediate and refined products.

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Our material commercial agreements with Delek Holdings include the following:

Asset/Operation

Initiation Date

Initial/Maximum Term (years) (1)

Minimum Throughput Commitment (bpd)

Lion Pipeline System and Gathering Assets (2) :

Crude Oil Pipelines (non-gathered)

November 2012

Asset/Operation Initiation Date Initial/Maximum Term (years) (1)

Service Minimum Throughput Commitment (bpd) Fee (/bbl)

El Dorado Assets and El Dorado Gathering System (2) :

Crude Oil Pipelines (non-gathered) November 2012 5 / 15

Crude oil and refined products transportation 46,000 (3)

Refined Products Pipelines

November 2012

Gathering Assets

November 2012

Refined Products Pipelines November 2012 5 / 15

El Dorado Gathering System November 2012 5 / 15

Crude oil gathering 14,000

East Texas Crude Logistics System (2) :

Crude Oil Pipelines

November 2012

Crude Oil Pipelines November 2012 5 / 15

Crude oil transportation and storage 35,000

November 2012

$303,774/month

East Texas Marketing

November 2012

Storage November 2012 5 / 15

N/A $ 309,892 /month

East Texas Marketing November 2012 10 (6)

Marketing products for Tyler Refinery 50,000

Big Sandy Terminal:

Refined Products Transportation

November 2012

Refined Products Transportation November 2012 5 / 15

Refined products transportation, dedicated terminalling services and storage for the Tyler Refinery 5,000

November 2012

$60,701/month

Terminalling November 2012 5 / 15

Storage November 2012 5 / 15

N/A $ 61,923 /month

Tyler Throughput and Tankage (2) :

Refined Products Throughput

Refined Products Throughput July 2013 8 / 16

Dedicated Terminalling and storage 50,000

$905,056/month

Memphis Pipeline

Storage July 2013 8 / 16

N/A $ 894,648 /month

Memphis Pipeline June 1, 2018 5

Refined Products Transportation 11,000

El Dorado Throughput and Tankage (2) :

Refined Products Throughput

February 2014

Refined Products Throughput February 2014 8 / 16

Dedicated terminalling and storage 11,000

February 2014

$1,416,771/month

Storage February 2014 8 / 16

N/A $ 1,400,478 /month

El Dorado Assets Throughput:

Light Crude Throughput

Dedicated Offloading Services

Heavy Crude Throughput

Dedicated Offloading Services

Pipelines, Storage and Throughput Facilities Agreement (Big Spring):

Crude Oil and Refined Products Throughput

March 1, 2018

Light Crude Throughput March 2015 9 / 15

Dedicated Offloading Services N/A (7)

Heavy Crude Throughput March 2015 9 / 15

Dedicated Offloading Services N/A (7)

Pipelines, Storage and Throughput Facilities Agreement (Big Spring Logistics Assets):

Crude Oil and Refined Products Throughput March 1, 2018 10 / 15

Pipeline throughput 104,300

Rail Offloading

March 1, 2018

Rail Offloading March 1, 2018 10 / 15

Offloading services 4,500

March 1, 2018

Terminalling March 1, 2018 10 / 15

Dedicated Terminalling 29,250

March 1, 2018

$1,427,827/month

Asphalt Services Agreement (Big Spring):

March 1, 2018

Dedicated Asphalt Terminalling and Storage

1,020 to 2,380 based on seasonality

March 1, 2018

$474,156/month

Marketing Agreement (Big Spring):

Marketing Services

March 1, 2018

Storage March 1, 2018 10 / 15

Storage NA $ 1,411,406 /month

Asphalt Services Agreement (Big Spring Logistics Assets):

Terminalling March 1, 2018 10 / 15

Dedicated Asphalt Terminalling and Storage 1,020 to 2,380 based on seasonality

Storage March 1, 2018 10 / 15

N/A $ 468,703 /month

Marketing Agreement (Big Spring Logistics Assets):

Marketing Services March 1, 2018 10 / 15

Dedicated Marketing and Selling 65,000

$ 0.51 - $ 0.73

Throughput and Deficiency Agreement (Big Spring Gathering Assets)

Gathering System March 31, 2020 10 / 20

Gathering and Transportation Services 120,000

Re-delivery System March 30, 2020 10 / 20

Notes to Consolidated Financial Statements

Pipelines, Throughput and Offloading Facilities Agreement (Big Spring Logistics Assets)

Fintex / Magellen Pipeline April 1, 2020 2

Refined Products 20,000

Crude Oil Offloading January 1, 2020 2

Crude Oil Offloading 15,120

Storage April 1, 2020 2

Storage N/A $ 240,000 /month

LPG Rack January 1, 2020 2

Truck Unloading Facility 4,500

Transportation Services Agreement

Trucking Services May 1, 2020 10 / 14

Transportation Services N/A $ 39,000,000 /Minimum Annual Revenue Commitment

(1) Maximum term gives effect to the extension of the commercial agreement pursuant to the terms thereof.

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While the current terms of the agreement were extended, the upcoming renewal terms were reduced.

Therefore, the overall duration of the maximum term above remains unchanged.

(3) Excludes volumes gathered on the Gathering Assets.

(4) Volumes gathered on the Gathering Assets will not be subject to an additional fee for transportation on our Lion Pipeline System to the El Dorado Refinery.

Therefore, the overall duration of the maximum term remains unchanged.

(3) Excludes volumes gathered on the El Dorado Gathering System (the "El Dorado Gathering System").

(4) Volumes gathered on the El Dorado Gathering System will not be subject to an additional fee for transportation on our El Dorado Assets (the "El Dorado Assets") to the El Dorado Refinery.

(5) For any volumes in excess of 50,000 bpd, the throughput fee will be $ 0.74 /bbl.

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The initial primary term for the marketing agreement has been extended through 2027.

(7) On July 19, 2013, we acquired the Hopewell Pipeline in order to effectively connect it with the Big Sandy Pipeline and thereby return the Big Sandy Terminal to operation.

In connection with the acquisition, on July 25, 2013, we and Delek Holdings entered into the Amended and Restated Services Agreement (Big Sandy Terminal and Pipeline), which amended and restated the terminalling services agreement for the Big Sandy Terminal originally entered into in November 2012.

(7) The throughput agreement provides for a minimum throughput fee of $ 1.6 million per quarter for throughput of a combination of light and heavy crude.

Pursuant to an arrangement with Delek Holdings and its subsidiary Lion Oil Company ("Lion Oil"), to which we are not a party, J.

Pursuant to financing arrangements between Delek Holdings and its subsidiaries, Lion Oil Company, LLC, Lion Oil Trading & Transportation, LLC and Alon USA LP, (all hereinafter referred to together as "Delek Holdings"), to which we are not a party, and J.

Aron & Company ("J.

Aron") acquires and holds title to substantially all crude oil, intermediate and refined products transported on our Lion Pipeline System, Gathering Assets and on pipeline capacity we lease from Enterprise TE Products Pipeline Company LLC that runs from the El Dorado Refinery to our Memphis Terminal (the "Memphis Pipeline").

Aron is therefore considered the shipper for the liquid it owns on the Lion Pipeline System, the Gathering Assets and the Memphis Pipeline.

Aron also has title to the refined products stored at our Memphis, North Little Rock and El Dorado terminals and in the El Dorado storage tanks.

Under (i) our pipelines and storage agreement with Lion Oil relating to the Lion Pipeline System and the Gathering Assets, (ii) our terminalling agreements with Lion Oil relating to the Memphis and North Little Rock terminals and (iii) our throughput and tankage agreement relating to the terminal and tank assets at and adjacent to the El Dorado Refinery, Lion Oil has assigned to J.

Aron certain of its rights under these agreements, including the right to have J.

Aron's crude oil and intermediate and refined products stored in or transported on or through these systems, Memphis and North Little Rock terminals and the terminal and tank assets at and adjacent to the El Dorado Refinery, with Lion Oil acting as J.

Aron's agent for scheduling purposes.

Pursuant to a similar arrangement with Delek Holdings and its subsidiary Alon USA, LP, hereinafter referred to as "Big Spring Refining," J.

Aron acquires and holds either title to or a lien on a portion of the crude oil, intermediate and refined products shipped on pipelines or stored at the terminal and storage tanks acquired in the Big Spring Logistic Assets Acquisition.

Under (i) our pipelines, storage and throughput facilities agreement with Big Spring Refining relating to certain storage tanks, pipelines and a terminal in Duncan, Oklahoma and (ii) our asphalt services agreement with Big Spring Refining relating to asphalt storage and terminalling near the Big Spring Refinery, Big Spring Refining has assigned to J.

Aron certain of its rights under these agreements, including the right to have J.

Aron's crude oil and intermediate and refined products stored in or transported on or through these storage and terminalling assets at or adjacent to the Big Spring Refinery, with Big Spring Refining acting as J.

Aron's agent for scheduling purposes.

Accordingly, even though this is effectively a financing arrangement for Delek Holdings and its subsidiaries whereby J.

Aron sells the product back to Delek Holdings and its subsidiaries, J.

Aron"), Delek Holdings assigned to J.

Aron certain of its rights under our specific terminalling agreements, pipelines, storage and throughput facilities agreements, and asphalt services agreements.

Accordingly, even though this is effectively a financing arrangement for Delek Holdings whereby J.

Aron sells the product back to Delek Holdings, J.

Aron is technically our primary customer under each of these agreements.

Aron retains these storage and transportation rights for the term of its arrangement with Lion Oil, which currently runs through April 30, 2020, and for the term of its arrangement with Big Spring Refining, which currently runs through May 31, 2021, unless terminated earlier pursuant to the terms of the arrangement.

Aron retains these storage and transportation rights for the term of the financing arrangement, which currently runs through December 30, 2022, with J.

Aron having the sole discretion to further extend to May 30, 2025, by giving at least six months prior notice to the maturity date.

Aron pays us for the transportation, throughput and storage services we provide to it.

The rights assigned to J.

Aron do not alter the obligations of Lion Oil or Big Spring Refining to meet certain throughput minimum volumes under our agreements with respect to the transportation, throughputting and storage of crude oil, intermediate and refined products through our facilities, but J.

Aron's throughput is credited toward minimum throughput commitments of Lion Oil and Big Spring Refining.

Accordingly, Lion Oil and Big Spring Refining are responsible for making any shortfall payments incurred under the pipelines and storage agreement or the terminalling agreement which may result from minimum throughputs or volumes not being met.

Aron do not alter the obligations of Delek Holding to meet certain throughput minimum volumes under our agreements with respect to the transportation, gathering and storage of crude oil, intermediate and refined products through our facilities, but J.

Aron's throughput is credited toward minimum throughput commitments of Delek Holdings.

Accordingly, Delek Holdings is responsible for making any shortfall payments incurred under the pipelines and storage agreement or the terminalling agreement which may result from minimum throughputs or volumes not being met.

Other Agreements with Delek Holdings

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Omnibus Agreement

The Partnership entered into an omnibus agreement with Delek Holdings, our general partner, Delek Logistics Operating, LLC, Lion Oil Company and certain of the Partnership’s and Delek Holdings' other subsidiaries on November 7, 2012, which has been amended from time to time in connection with acquisitions from Delek Holdings (collectively, as amended, the "Omnibus Agreement").

The Omnibus Agreement governs the provision of certain operational services and reimbursement obligations, among other matters, between the Partnership and Delek Holdings, and with the March 2018 amendment, obligates us to pay an annual fee of $ 3.9 million to Delek Holdings for its provision of centralized corporate services to the Partnership, up from $ 3.7 million in 2017.

Notes to Consolidated Financial Statements

The Partnership entered into an omnibus agreement with Delek Holdings, our general partner, Delek Logistics Operating, LLC, Lion Oil Company, LLC and certain of the Partnership’s and Delek Holdings' other subsidiaries on November 7, 2012, which has been amended from time to time in connection with acquisitions from Delek Holdings (collectively, as amended, the "Omnibus Agreement").

The Omnibus Agreement governs the provision of certain operational services and reimbursement obligations, among other matters, between the Partnership and Delek Holdings, and obligates us to pay an annual fee of $ 4.7 million to Delek Holdings for its provision of centralized corporate services to the Partnership.

Pursuant to the terms of the Omnibus Agreement, we were reimbursed by Delek Holdings for certain capital expenditures in the amount of $ 0.6 million, $ 3.7 million and $ 5.0 million during the years ended December 31, 2020, 2019 and 2018, respectively.

These amounts are recorded in other long-term liabilities and are amortized to revenue over the life of the underlying revenue agreement corresponding to the asset.

Additionally, we are reimbursed or indemnified, as the case may be, for costs incurred in excess of certain amounts related to certain asset failures, pursuant to the terms of the Omnibus Agreement.

As of December 31, 2019 and 2018 , we recorded a receivable from related parties of a nominal amount and $ 1.6 million , respectively, for these matters for which we expect to be reimbursed.

These reimbursements are recorded as reductions to operating expenses.

As of December 31, 2020 and 2019, we have recorded a nominal receivable from related parties for these matters for which we expect to be reimbursed.

These reimbursements are recorded as reductions

Notes to Consolidated Financial Statements

to operating expenses.

We were reimbursed $ 0.1 million, $ 6.3 million and $ 8.2 million for these matters during the year ended December 31, 2020, 2019 and 2018, respectively.

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Other Transactions

Starting in 2018, the Partnership manages a long-term capital project on behalf of Delek Holdings pursuant to a construction management and operating agreement (the "DPG Management Agreement") for the construction of a 250-mile gathering system in the Permian Basin (the "Delek Permian Gathering Project").

The Partnership is also considered the operator for the project and will oversee functions such as oversight of project design, procurement and construction of project segments and provide other related services.

The Partnership manages a long-term capital project on behalf of Delek Holdings pursuant to a construction management and operating agreement (the "DPG Management Agreement") for the construction of a 250-mile gathering system in the Permian Basin.

The majority of the gathering system has been constructed, however, additional costs pertaining to a pipeline connection that was not acquired by the Partnership continue to be incurred and are still subject to the terms of the DPG Management Agreement.

Pursuant to the terms of the DPG Management Agreement, the Partnership receives a monthly operating services fee and a construction services fee, which includes the Partnership's direct costs of managing the project plus an additional percentage fee of the construction costs of each project segment.

The agreement extends through December 2022.

Total fees paid to the Partnership for the years ended December 31, 2019 and 2018 were $ 6.1 million and $ 4.8 million , respectively.

Total fees paid to the Partnership were $ 2.0 million and $ 6.1 million for the years ended December 31, 2020 and 2019, respectively, which are recorded in affiliate revenue in our consolidated statements of income.

Additionally, the Partnership incurs the costs in connection with the construction of the assets and is subsequently reimbursed by Delek Holdings.

Amounts reimbursable by Delek Holdings are recorded in accounts receivable from related parties.

Unregistered Sale of Equity Securities

In connection with the Partnership's issuance of the common limited partner units under the Big Spring Gathering Assets Acquisition and in accordance with the Partnership's First Amended and Restated Agreement of Limited Partnership, as amended (the "Partnership Agreement"), the Partnership issued general partner units to the general partner in an amount necessary to maintain its 2% general partner interest as defined in the Partnership Agreement.

The sale and issuance of the Additional Units and such general partner units in connection with the Big Spring Gathering Assets Acquisition is exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended.

Additionally, in March 2020, Delek Marketing & Supply, LLC ("Delek Marketing") repurchased 451,822 common limited partner units from an unaffiliated investor pursuant to a Common Unit Purchase Agreement between Delek Marketing and such investor.

The purchase price of the units amounted to approximately $ 5.0 million.

As a result of the transaction, Delek Holdings' ownership in our common limited partner units increased to 64.5 % from 62.6 %.

Delek Holdings' ownership in our common limited partner units was further increased to 70.5 % as a result of the issuance of 5.0 million Additional Units in connection with the Big Spring Gathering Assets Acquisition described above.

In August 2020, Delek Holdings ownership in our common limited partner units was further increased to approximately 80.0 % in connection with the IDR Restructuring Transaction, when the Partnership issued 14.0 million of the Partnership's newly issued common limited partner units to Delek Holdings.

Amendment No.

2 to the First Amended and Restated Agreement of Limited Partnership of Delek Logistics Partners, LP

On March 31, 2020, in connection with the completion of the Big Spring Gathering Assets Acquisition, the Board of the general partner adopted Amendment No.

2 (“Amendment No.

2”) to the Partnership Agreement, effective upon adoption.

Amendment No.

2 amended the Partnership Agreement to provide for a waiver of distributions in respect of the Incentive Distribution Rights ("IDRs") for General Partner Additional Units ("GP Additional Units") associated with the 5.0 million Additional Units for at least two years, through at least the distribution for the quarter ending March 31, 2022 ( the “IDR Waiver”).

The IDR Waiver essentially reduced the distribution made to the holders of the IDRs during this period, as the holders would not receive a share of the distribution made on the GP Additional Units.

Subsequently, the IDRs were eliminated in the IDR Restructuring Transaction on August 13, 2020.

Conversion of GP Economic Interest and Elimination of IDRs

On August 13, 2020, we closed the transaction contemplated by a definitive exchange agreement with Delek Holdings to eliminate all of the IDRs held by the general partner and convert the 2 % general partner economic interest into a non-economic general partner interest, all in exchange for 14.0 million of the Partnership's newly issued common limited partner units and $ 45.0 million cash.

Contemporaneously, Delek Holdings purchased a 5.2 % ownership interest in our general partner from certain affiliates who were also members of our general partner's management and board of directors.

Delek Holdings now owns 100 % interest in the general partner and owns approximately

Notes to Consolidated Financial Statements

34.7 million common limited partner units, representing approximately 80 % of the Partnership's outstanding common limited partner units.

To implement the transaction, our Partnership Agreement was amended and restated.

Summary of Transactions

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Year Ended December 31,

2020 2019 2018

Revenues $ 382,666 $ 261,014 $ 240,809

Purchases from Affiliates $ 205,581 $ 285,539 $ 349,089

Operating and maintenance expenses

$ 43,985 $ 49,904 $ 36,182

General and administrative expenses

$ 12,557 $ 7,977 $ 8,250

Quarterly Cash Distribution

Our common and general partner unitholders and the holders of IDRs are entitled to receive quarterly distributions of available cash as it is determined by the board of directors of our general partner in accordance with the terms and provisions of our Partnership Agreement.

Prior to August 13, 2020, our common and general partner unitholders and the holders of IDRs were entitled to receive quarterly distributions of available cash as it was determined by the board of directors of our general partner in accordance with the terms and provisions of our Partnership Agreement.

Pursuant to the IDR Restructuring Transaction on August 13, 2020, the general partner will no longer receive any cash distributions.

During the years ended December 31, 2020, 2019 and 2018, we paid quarterly cash distributions of $ 136.8 million, $ 113.7 million and $ 97.7 million, respectively, of which $ 105.3 million, $ 83.0 million and $ 70.1 million, respectively, were paid to Delek Holdings and our general partner.

On January 24, 2020 , our general partner's board of directors declared a quarterly cash distribution totaling $ 30.6 million based on the available cash as of the date of determination for the end of the fourth quarter of 2019 , which was paid on February 12, 2020 to unitholders of record on February 4, 2020 .

The distribution included $ 22.6 million paid to both Delek Holdings and our general partner, including the distribution as holder of the IDRs.

Notes to Consolidated Financial Statements

On January 22, 2021, our board of directors declared a quarterly cash distribution totaling $ 39.5 million based on the available cash as of the date of determination for the end of the fourth quarter of 2020.

The distribution was paid on February 9, 2021 to unitholders of record on February 2, 2021, of which $ 31.6 million was paid to Delek Holdings .

We generate revenue by charging fees for gathering, transporting, offloading and storing crude oil;

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We have determined that the predominant component of the related agreements currently in effect is the lease component.

Therefore, the combined component is accounted for under the applicable lease accounting guidance.

Therefore, the combined component is accounted for

Notes to Consolidated Financial Statements

under the applicable lease accounting guidance.

Of our $ 464.8 million net property, plant, and equipment balance as of December 31, 2020, $ 396.8 million is subject to operating leases under our commercial agreements.

These agreements do not include options for the lessee to purchase our leasing equipment, nor do they include any material residual value guarantees or material restrictive covenants.

These agreements do not include options for the lessee to purchase our leased assets, nor do they include any material residual value guarantees or material restrictive covenants.

The following table represents a disaggregation of revenue for each reportable segment for the periods indicated (in thousands):

Year Ended December 31, 2020

Pipelines and Transportation

Wholesale Marketing and Terminalling

Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated

Service Revenue - Third Party $ 17,596 $ 634 $ 18,230

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Lease Revenue - Affiliate (1)

216,105 43,983 260,088

Total Revenue $ 251,469 $ 311,949 $ 563,418

(1) Disaggregated revenue for the year ended December 31, 2019 may not be comparable to disaggregated revenue for the year ended December 31, 2018 as a result of our adoption of ASC 842, under which we applied the predominance principle and opted to not separate lease and non-lease components.

(1) Net of $ 7.2 million of amortization expense for the year ended December 31, 2020, related to a customer contract intangible asset recorded in the wholesale marketing and terminalling segment.

Year Ended December 31, 2019

Pipelines and Transportation

Wholesale Marketing and Terminalling

Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated

Service Revenue - Third Party $ 23,107 $ 623 $ 23,730

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Lease Revenue - Affiliate (1)

155,211 38,654 193,865

Total Revenue $ 178,318 $ 405,674 $ 583,992

(1) Net of $ 7.2 million of amortization expense for the year ended December 31, 2019, related to a customer contract intangible asset recorded in the wholesale marketing and terminalling segment.

As of December 31, 2019 , we expect to recognize approximately $ 1.0 billion in lease revenues related to our unfulfilled performance obligations pertaining to the minimum volume commitments and capacity utilization under the non-cancelable terms of our commercial agreements with

Notes to Consolidated Financial Statements

Delek Holdings.

As of December 31, 2020, we expect to recognize approximately $ 1.5 billion in lease revenues related to our unfulfilled performance obligations pertaining to the minimum volume commitments and capacity utilization under the non-cancelable terms of our commercial agreements with Delek Holdings.

Most of these agreements have an initial term ranging from five to ten years, which may be extended for various renewal terms.

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Our unfulfilled performance obligations as of December 31, 2020 were as follows (in thousands):

2021 $ 269,181

2025 and thereafter 589,715

Total expected revenue on remaining performance obligations $ 1,518,267

Notes to Consolidated Financial Statements

Net Income Per Unit

We use the two-class method when calculating the net income per unit applicable to limited partners, because we have more than one participating class of securities.

Our participating securities consist of common units, general partner units and IDRs.

Earnings in excess of distributions are allocated to our general partner and limited partners based on their respective ownership interests.

Payments made to our unitholders are determined in relation to actual distributions declared and are not based on the net income allocations used in the calculation of net income per unit.

Basic net income per unit applicable to limited partners is computed by dividing limited partners' interest in net income by the weighted-average number of outstanding common units.

Prior to August 13, 2020, we had more than one class of participating securities and used the two class method to calculate the net income per unit applicable to the limited partners.

The classes of participating units prior to August 13, 2020 consisted of limited partner units, general partner units and IDRs.

Pursuant to the IDR Restructuring Transaction, the IDRs were eliminated and the 2 % general partner economic interest was converted to a non-economic general partner interest.

Effective August 13, 2020, the common limited partner units are the only participating security for cash distributions.

Refer to Note 12 - Equity for a discussion of the elimination of the IDRs and conversion of the 2 % general partner economic interest effective August 13, 2020.

The two-class method was based on the weighted-average number of common units outstanding during the period.

Basic net income per unit applicable to limited partners was computed by dividing limited partners’ interest in net income, after deducting our general partner’s 2 % interest and IDRs, by the weighted-average number of outstanding common units.

Our net income was allocated to our general partner and limited partners in accordance with their respective partnership percentages after giving effect to priority income allocations for IDRs, which are held by our general partner pursuant to our Partnership Agreement.

Earnings in excess of distributions were allocated to our general partner and limited partners based on their respective ownership interests.

The IDRs were paid following the close of each quarter.

As discussed in Note 4 - Related Party Transactions, pursuant to Amendment No.

2 to the Partnership Agreement, an agreement was reached for a waiver of distributions in respect of the IDRs for the GP Additional Units associated with the 5.0 million Additional Units issued in connection with the Big Spring Gathering Assets Acquisition for at least two years, through at least the distribution for the quarter ending March 31, 2022.

The IDR Waiver essentially reduced the distribution made to the holders of the IDRs during this period, as the holders would not receive a share of the distribution made on the GP Additional Units.

An additional waiver letter was signed that waived all of the distributions for the first quarter of 2020 on the Additional Units with respect to base distributions and the IDRs.

Refer to Note 4 for additional details.

Subsequently, the IDRs were eliminated in the IDR Restructuring Transaction on August 13, 2020.

Diluted net income per unit applicable to common limited partners includes the effects of potentially dilutive units on our common units.

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Therefore, the table below represents total cash distributions applicable to the period in which the distributions are earned.

The date of distribution for the distributions earned during the period ended December 31, 2019 is February 12, 2020 .

The date of distribution for the distributions earned during the quarterly period ended December 31, 2020 is February 9, 2021.

The calculation of net income per unit is as follows (dollars in thousands, except units and per unit amounts):

Notes to Consolidated Financial Statements

Year Ended December 31,

2020 2019 2018

Net income attributable to partners $ 159,256 $ 96,749 $ 90,182

General partner's distribution (including IDRs) (1)

18,618 33,492 25,777

Limited partners' distribution 127,070 83,873 76,113

Distributions in excess of earnings

Earning in excess (deficit) of distributions $ 13,568 $ ( 20,616 ) $ ( 11,708 )

General partner's earnings:

Distributions (including IDRs) (1)

Distributions in excess of earnings

$ 18,618 $ 33,492 $ 25,777

Allocation of earnings in excess (deficit) of distributions 106 ( 412 ) ( 234 )

Total general partner's earnings $ 18,724 $ 33,080 $ 25,543

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Distributions $ 127,070 $ 83,873 $ 76,113

Distributions in excess of earnings

Allocation of earnings in excess (deficit) of distributions 13,462 ( 20,204 ) ( 11,474 )

Total limited partners' earnings on common units $ 140,532 $ 63,669 $ 64,639

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Common - diluted (2)

Notes to Consolidated Financial Statements

(1) General partner distributions (including IDRs) consist of the 2 % general partner interest and IDRs, which represent the right of the general partner to receive increasing percentages of quarterly distributions of available cash from operating surplus in excess of 0.43125 per unit per quarter.

$ 4.18 $ 2.61 $ 2.65

(1) Prior to August 13, 2020, general partner distributions (including IDRs) consist of the 2 % general partner interest and IDRs, which represent the right of the general partner to receive increasing percentages of quarterly distributions of available cash from operating surplus in excess of 0.43125 per unit per quarter.

In connection with the IDR Restructuring Transaction on August 13, 2020, the IDRs were eliminated and the general partner interest became a non-economic general partner interest.

See Note 12 for further discussion related to IDRs.

(2) There were no outstanding common unit equivalents excluded from the diluted earnings per unit calculation during both years ended December 31, 2019 and December 31, 2017 .

Outstanding common unit equivalents totaling 1,776 were excluded from the diluted earnings per unit calculation for the years ended December 31, 2018 , as these common unit equivalents did not have a dilutive effect under the treasury stock method.

Inventories consisted of $ 12.6 million and $ 5.5 million of refined petroleum products as of December 31, 2019 and 2018 , respectively.

Inventory is stated at the lower of cost or net realizable value, with cost determined on a FIFO basis.

We recognize lower of cost or net realizable value charges as a component of cost of materials and other in the consolidated statements of income and comprehensive income, which amounted to $ 0.1 million and $ 0.2 million during the years ended December 31, 2019 and 2018 , respectively.

(2) There were 5,201 and 1,776 outstanding common unit equivalents excluded from the diluted earnings per unit calculation during both years ended December 31, 2020 and 2018.

There were no outstanding common unit equivalents excluded from the diluted earnings per unit calculation for the year ended December 31, 2019, as these common unit equivalents did not have a dilutive effect under the treasury stock method.

Inventories consisted of $ 3.1 million and $ 12.6 million of refined petroleum products as of December 31, 2020 and 2019, respectively, each of which are net of lower of cost or net realizable value reserve of a nominal amount.

Inventory is stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out basis.

We recognize lower of cost or net realizable value charges as a component of cost of materials and other in the consolidated statements of income and comprehensive income.

Property, Plant and Equipment

Property, plant and equipment, at cost, consist of the following (in thousands):

Land $ 14,533 $ 4,458

Building and building improvements 2,742 1,853

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As of and For the Year Ended December 31, 2020

Pipelines and Transportation

Wholesale Marketing and Terminalling

Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated

Property, plant and equipment $ 580,631 $ 111,651 $ 692,282

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As of and For the Year Ended December 31, 2019

Pipelines and Transportation

Wholesale Marketing and Terminalling

Pipelines and Transportation Wholesale Marketing and Terminalling Consolidated

Property, plant and equipment $ 354,429 $ 106,896 $ 461,325

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Depreciation expense $ 20,803 $ 5,898 $ 26,701

Notes to Consolidated Financial Statements

Goodwill represents the excess of the aggregate purchase price over the fair value of the identifiable net assets acquired and is not amortized.

Our goodwill relates to the West Texas assets contributed to us by Delek Marketing & Supply, LLC ("Delek Marketing"), a direct wholly owned subsidiary of Delek Holdings, in connection with our initial public offering (the "Offering") and to the purchase price allocation of certain of our third party acquisitions.

Our goodwill relates to the West Texas assets contributed to us by Delek Marketing & Supply, LLC ("Delek Marketing"), a direct wholly owned subsidiary of Delek Holdings, in connection with our initial public offering and to the purchase price allocation of certain of our third party acquisitions.

We perform an annual assessment of whether goodwill retains its value.

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We performed our annual goodwill impairment review in the fourth quarter of 2020, 2019 and 2018.

We performed a qualitative assessment for the years ended December 31, 2019 and December 31, 2018 .

During the year ended December 31, 2017 , we performed a discounted cash flow test, using a market participant weighted average cost of capital, and estimated minimal growth rates for revenue, gross profit and capital expenditures based on history and our best estimate of future forecasts.

We also estimated the fair values using a multiple of expected future cash flows, such as those used by market participants.

We performed a qualitative assessment for the years ended December 31, 2020, December 31, 2019 and December 31, 2018.

In 2020, 2019 and 2018, the annual impairment review resulted in the determination that no indicators of impairment of goodwill were present.

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Our identifiable intangible assets are as follows (in thousands):

As of December 31, 2019

Useful Accumulated

As of December 31, 2020 Life Gross Amortization Net

Intangible assets subject to amortization:

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Intangible assets not subject to amortization:

Rights-of-way assets

As of December 31, 2018

Rights-of-way assets Indefinite 36,316 36,316

Total $ 180,535 $ ( 20,431 ) $ 160,104

Useful Accumulated

As of December 31, 2019 Life Gross Amortization Net

Intangible assets subject to amortization:

Supply contract

Marketing contract 20 144,219 ( 13,220 ) $ 130,999

Intangible assets not subject to amortization:

Rights-of-way assets

Amortization of intangible assets was $ 7.2 million , $ 6.1 million and $ 1.1 million during the years ended December 31, 2019 , 2018 and 2017 , respectively, and is included as a component of net revenue on the accompanying consolidated statements of income and comprehensive income.

Rights-of-way assets Indefinite 15,597 15,597

Total $ 159,816 $ ( 13,220 ) $ 146,596

Amortization of intangible assets was $ 7.2 million during both the years ended December 31, 2020 and 2019.

Amortization of intangible assets was $ 6.1 million during the year ended December 31, 2018.

It is included as a reduction of net revenue on the accompanying consolidated statements of income and comprehensive income.

Amortization expense is estimated to be $ 7.2 million for each of the years ended December 31, 2021 through 2025.

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DKL Credit Facility

Prior to September 28, 2018, the Partnership had a $ 700.0 million senior secured revolving credit agreement with Fifth Third Bank ("Fifth Third"), as administrative agent, and a syndicate of lenders (the "2014 Facility") with a $100.0 million accordion feature, bearing interest at (i) either a U.S.

prime dollar rate or a LIBOR Rate for borrowings denominated in U.S.

Dollars, or (ii) either a Canadian dollar prime rate, or a Canadian Dealer Offered Rate, for borrowings denominated in Canadian dollars (in each case plus applicable margins, at the election of the borrowers and as a function of draw down currency).

The 2014 Facility had a maturity date of December 30, 2019.

The obligations under the 2014 Facility were secured by a first priority lien on substantially all of the Partnership's tangible and intangible assets.

Additionally, a subsidiary of Delek Holdings provided a limited guaranty of the Partnership's obligations under the 2014 Facility.

On September 28, 2018, the Partnership entered into a third amended and restated senior secured revolving credit agreement, which amended and restated the 2014 Facility (hereafter, the "DKL Credit Facility") with Fifth Third Bank, as administrative agent, and a syndicate of lenders.

Notes to Consolidated Financial Statements

On September 28, 2018, the Partnership entered into a third amended and restated senior secured revolving credit agreement (hereafter, the "DKL Credit Facility") with Fifth Third Bank ("Fifth Third"), as administrative agent, and a syndicate of lenders with total lender commitments of $ 850.0 million.

The DKL Credit Facility contains a dual currency borrowing tranche that permits draw downs in U.S.

or Canadian dollars.

Under the terms of the DKL Credit Facility, among other things, the lender commitments were increased to $ 850.0 million .

The DKL Credit Facility also contains an accordion feature whereby the Partnership can increase the size of the credit facility to an aggregate of $ 1.0 billion, subject to receiving increased or new commitments from lenders and the satisfaction of certain other conditions precedent.

The obligations under the DKL Credit Facility remain secured by first priority liens on substantially all of the Partnership's and its subsidiaries' tangible and intangible assets.

Additionally, Delek Marketing & Supply, LLC ("Delek Marketing"), a subsidiary of Delek Holdings, continues to provide a limited guaranty of the Partnership's obligations under the DKL Credit Facility.

As of December 31, 2019 , the principal amount of the Holdings Note was $ 102.0 million .

Additionally, Delek Marketing, a subsidiary of Delek Holdings, had provided a limited guaranty of the Partnership's obligations under the DKL Credit Facility.

In connection with the IDR Restructuring Transaction, the Partnership entered into a First Amendment to the DKL Credit Facility (the "First Amendment") which, among other things, permitted the exchange of the IDRs and the general partner interest in the Partnership for the non-economic general partner interest, the newly issued limited partner interests in the Partnership, plus $ 45.0 million in cash.

The First Amendment also modified the total leverage and senior leverage ratios (as defined in the DKL Credit Facility) calculations to reduce the total funded debt (as defined in the DKL Credit Facility) component thereof by the total amount of unrestricted consolidated cash and cash equivalents on the balance sheet of the Partnership and its subsidiaries up to $ 20.0 million.

The DKL Credit Facility has a maturity date of September 28, 2023.

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dollars bear interest at either a U.S.

dollar prime rate, plus an applicable margin, or the LIBOR, plus an applicable margin, at the election of the borrowers.

dollar prime rate, plus an applicable margin, or the London Interbank Offered Rate ("LIBOR") plus an applicable margin, at the election of the borrowers.

Borrowings denominated in Canadian dollars bear interest at either a Canadian dollar prime rate, plus an applicable margin, or the Canadian Dealer Offered Rate, plus an applicable margin, at the election of the borrowers.

Notes to Consolidated Financial Statements

The applicable margin in each case and the fee payable for any unused revolving commitments vary based upon the Partnership's most recent total leverage ratio calculation delivered to the lenders, as called for and defined under the terms of the DKL Credit Facility.

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Interest on the 2025 Notes is payable semi-annually in arrears on each May 15 and November 15, commencing November 15, 2017.

At any time prior to May 15, 2020, the Issuers may redeem up to 35 % of the aggregate principal amount of the 2025 Notes with the net cash proceeds of one or more equity offerings by the Partnership at a redemption price of 106.750 % of the redeemed principal amount, plus accrued and unpaid interest, if any, subject to certain conditions and limitations.

Prior to May 15, 2020, the Issuers may redeem all or part of the 2025 Notes, at a redemption price of the principal amount, plus accrued and unpaid interest, if any, plus a "make whole" premium, subject to certain conditions and limitations.

In addition, beginning on May 15, 2020, th e Issuers may, subject to certain conditions and limitations, redeem all or part of the 2025 Notes at a redemption price of 105.063 % of the redeemed principal for the twelve-month period beginning on May 15, 2020, 103.375 % for the twelve-month period beginning on May 15, 2021, 101.688 % for the twelve-month period beginning on May 15, 2022 and 100.00 % beginning on May 15, 2023 and thereafter, plus accrued and unpaid interest, if any.

Beginning on May 15, 2020, th e Issuers may, subject to certain conditions and limitations, redeem all or part of the 2025 Notes at a redemption price of 105.063 % of the redeemed principal for the twelve-month period beginning on May 15, 2020, 103.375 % for the twelve-month period beginning on May 15, 2021, 101.688 % for the twelve-month period beginning on May 15, 2022 and 100.00 % beginning on May 15, 2023 and thereafter, plus accrued and unpaid interest, if any.

In the event of a change of control, accompanied or followed by a ratings downgrade within a certain period of time, subject to certain conditions and limitations, the Issuers will be obligated to make an offer for the purchase of the 2025 Notes from holders at a price equal to 101 % of the principal amount thereof, plus accrued and unpaid interest.

On April 25, 2018, we made an offer to exchange the 2025 Notes and the related guarantees that were validly tendered and not validly withdrawn for an equal principal amount of exchange notes that are freely tradeable, as required under the terms of the original indenture.

The terms of the exchange notes that were issued as a result of the exchange (also referred to as the "2025 Notes") are substantially identical to the terms of the original 2025 Notes.

The terms of the exchange notes that were issued in May 2018 as a result of the exchange (also referred to as the "2025 Notes") are substantially identical to the terms of the original 2025 Notes.

As of December 31, 2020, we had $ 250.0 million in outstanding principal amount of the 2025 Notes.

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Principal maturities of the Partnership's existing third party debt instruments for the next five years and thereafter are as follows as of December 31, 2020 (in thousands):

Notes to Consolidated Financial Statements

2021 2022 2023 2024 2025 Thereafter Total

DKL Credit Facility

$ — $ — $ 746,600 $ — $ — $ — $ 746,600

$ — $ — $ — $ — $ 250,000 $ — $ 250,000

Notes to Consolidated Financial Statements

We had 8,697,468 common limited partner units held by the public outstanding as of December 31, 2020.

Additionally, as of December 31, 2019 , Delek Holdings owned a 61.4 % limited partner interest in us, consisting of 15,294,046 common limited partner units and a 94.6 % interest in our general partner, which owns the entire 2.0 % general partner interest consisting of 498,482 general partner units.

Affiliates, who are also members of our general partner's management and board of directors, own the remaining 5.4 % interest in our general partner.

Additionally, as of December 31, 2020, Delek Holdings owned an 80.0 % limited partner interest in us, consisting of 34,745,868 common limited partner units.

Effective August 13, 2020, the Partnership closed on the IDR Restructuring Transaction, and contemporaneous with this transaction, Delek Holdings purchased a 5.2 % ownership interest in our general partner from certain affiliates, who were also members of our general partner's management and board of directors, at fair market value.

Delek Holdings now owns 100 % of the outstanding ownership interest in our general partner.

As part of this transaction, we expensed approximately $ 1.1 million of transaction costs.

In August 2020, we filed a shelf registration statement with the U.S.

Securities and Exchange Commission, which subsequently became effective, for the proposed re-sale or other disposition from time to time by Delek Holdings of up to 14.0 million of our common limited partner units.

As of December 31, 2020, we did not sell any securities under this shelf registration statement and we will not receive any proceeds from the sale of securities by Delek Holdings.

Equity Activity

The table below summarizes the changes in the number of units outstanding from December 31, 2018 through December 31, 2020.

Common - Public

Common - Delek Holdings

General Partner

Common - Public Common - Delek Holdings General Partner Total

Balance at December 31, 2017 9,088,587 15,294,046 497,604 24,880,237

1 unchanged sentence

Unit-based compensation awards (1)

Delek Holdings unit repurchases from public

21,220 — — 21,220

Balance at December 31, 2018 9,109,807 15,294,046 498,038 24,901,891

1 unchanged sentence

Unit-based compensation awards (1)

21,772 — — 21,772

Balance at December 31, 2019 9,131,579 15,294,046 498,482 24,924,107

General partner units issued to maintain 2 % interest

— — 102,196 102,196

Unit-based compensation awards (1)

17,711 — — 17,711

Big Spring Gathering Assets Acquisition equity issuance — 5,000,000 — 5,000,000

Delek Holdings unit purchases from public ( 451,822 ) 451,822 — —

General Partner units converted to non-economic general partner interest — — ( 600,678 ) ( 600,678 )

Common limited partner units issued in IDR Restructuring Transaction — 14,000,000 — 14,000,000

Balance at December 31, 2020 8,697,468 34,745,868 — 43,443,336

(1) Unit-based compensation awards are presented net of no , 598 and 14,053 units withheld for taxes as of December 31, 2019 , 2018 and 2017 , respectively.

(1) Unit-based compensation awards are presented net of 926 and 598 units withheld for taxes as of December 31, 2020 and 2018, respectively.

There were no units withheld for taxes as of December 31, 2019.

Issuance of Additional Securities

2 unchanged sentences

Allocations of Net Income

Our Partnership Agreement contains provisions for the allocation of net income and loss to the unitholders and our general partner.

Our Partnership Agreement contains provisions for the allocation of net income and loss to the unitholders.

For purposes of maintaining partner capital accounts, the Partnership Agreement specifies that items of income and loss shall be allocated among the partners in accordance with their respective percentage interest.

Normal allocations according to percentage interests are made after giving effect to priority income allocations in an amount equal to incentive cash distributions allocated 100% to our general partner.

Prior to August 13, 2020, normal allocations were made according to percentage interests after giving effect to priority income allocations in an amount equal to incentive cash distributions allocated 100% to our general partner.

Effective August 13, 2020, the IDRs were eliminated and the 2 % general partner economic interest was converted to a non-economic general partner interest that no longer receives cash distributions.

The following table presents the allocation of the general partner's interest in net income (in thousands, except percentage of ownership interest):

1 unchanged sentence

Year Ended December 31,

2020 2019 2018

Net income attributable to partners

$ 159,256 $ 96,749 $ 90,182

General partner's IDRs

( 17,632 ) ( 31,781 ) ( 24,224 )

Net income available to partners

$ 141,624 $ 64,968 $ 65,958

General partner's ownership interest

2.0 % 2.0 % 2.0 %

General partner's allocated interest in net income

1,092 1,299 1,319

General partner's IDRs

17,632 31,781 24,224

Total general partner's interest in net income

$ 18,724 $ 33,080 $ 25,543

Incentive Distribution Rights

Our general partner is currently entitled to 2.0 % of all quarterly distributions that we make prior to our liquidation.

Our general partner has the right, but not the obligation, to contribute up to a proportionate amount of capital to us to maintain its current general partner interest.

The general partner’s 2.0 % interest in these distributions may be reduced if we issue additional units in the future and our general partner does not contribute a proportionate amount of capital to us to maintain its 2.0 % general partner interest.

Our general partner also currently holds IDRs that entitle it to receive increasing percentages, up to a maximum of 48.0 % , of the cash we distribute from operating surplus (as defined in our Partnership Agreement) in excess of 0.43125 per unit per quarter.

The maximum distribution is 48.0 % and does not include any distributions that our general partner or its affiliates may receive on common or general partner units that it owns.

The IDRs held by our general partner currently entitle it to receive the maximum distribution.

Effective August 13, 2020, the Partnership closed on the IDR Restructuring Transaction and the general partner no longer receives any cash distributions.

Prior to August 13, 2020, our general partner was entitled to 2.0 % of all quarterly distributions that we make prior to our liquidation.

Our general partner had the right, but not the obligation, to contribute up to a proportionate amount of capital to us to maintain its current general partner interest.

Our general partner held IDRs that entitled it to receive increasing percentages, up to a maximum of 48.0 %, of the cash we distributed from operating surplus (as defined in our Partnership Agreement) in excess of 0.43125 per unit per quarter.

The maximum distribution was 48.0 % and did not include any distributions that our general partner or its affiliates may have received on common or general partner units that it owns.

As of August 12, 2020, the IDRs held by our general partner were entitled to receive the maximum distribution.

Cash Distributions

Our Partnership Agreement sets forth the calculation to be used to determine the amount and priority of available cash distributions that our limited partner unitholders and general partner will receive.

The cash distributions for periods before August 13, 2020 include distributions to the 2 % general partner interest which was converted to non-economic general partner interest and IDRs which were permanently eliminated.

Our distributions earned with respect to a given period are declared subsequent to quarter end.

The table below summarizes the quarterly distributions related to our quarterly financial results:

Quarter Ended

Total Quarterly Distribution Per Limited Partner Unit

Total Quarterly Distribution Per Limited Partner Unit, Annualized

Total Cash Distribution, including general partner interest and IDRs (in thousands)

Date of Distribution

Unitholders Record Date

December 31, 2017

February 12, 2018

February 2, 2018

March 31, 2018

June 30, 2018

August 13, 2018

August 3, 2018

September 30, 2018

November 9, 2018

November 2, 2018

December 31, 2018

February 12, 2019

February 4, 2019

March 31, 2019

June 30, 2019

August 13, 2019

August 5, 2019

September 30, 2019

November 12, 2019

November 4, 2019

December 31, 2019

February 12, 2020

February 4, 2020

Quarter Ended Total Quarterly Distribution Per Limited Partner Unit Total Quarterly Distribution Per Limited Partner Unit, Annualized Total Cash Distribution, including general partner interest and IDRs (in thousands) Date of Distribution Unitholders Record Date

December 31, 2018 $ 0.810 $ 3.24 $ 26,949 February 12, 2019 February 4, 2019

March 31, 2019 $ 0.820 $ 3.28 $ 27,438 May 14, 2019 May 7, 2019

June 30, 2019 $ 0.850 $ 3.40 $ 28,914 August 13, 2019 August 5, 2019

September 30, 2019 $ 0.880 $ 3.52 $ 30,379 November 12, 2019 November 4, 2019

December 31, 2019 $ 0.885 $ 3.54 $ 30,634 February 12, 2020 February 4, 2020

March 31, 2020 $ 0.890 $ 3.56 $ 30,878 May 12, 2020 May 5, 2020

June 30, 2020 $ 0.900 $ 3.60 $ 35,969 August 12, 2020 August 7, 2020

September 30, 2020 $ 0.905 $ 3.62 $ 39,308 November 12, 2020 November 6, 2020

December 31, 2020 $ 0.910 $ 3.64 $ 39,533 February 9, 2021 February 2, 2021

Notes to Consolidated Financial Statements

3 unchanged sentences

Year Ended December 31,

2020 2019 2018

General partner's distributions:

8 unchanged sentences

The Delek Logistics GP, LLC 2012 Long-Term Incentive Plan (the "LTIP") was adopted by the Delek Logistics GP, LLC board of directors in connection with the completion of our initial public offering in November 2012.

The LTIP is administered by the Conflicts Committee of the board of directors of our general partner.

The LTIP is administered by the Conflicts Committee of the board of directors.

Equity-based compensation expense is included in general and administrative expenses in the accompanying consolidated statements of income and comprehensive income and is immaterial for the years ended December 31, 2020, 2019 and 2018.

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In addition, we contributed $ 0.4 million of start up capital pursuant to the Amended and Restated Limited Liability Company Agreement.

Red River owns a crude oil pipeline running from Cushing, Oklahoma to Longview, Texas, with an expansion project planned to increase the pipeline capacity, which is expected to be completed during the first half of 2020.

We contributed an additional $ 3.5 million related to such expansion project in May 2019.

Subsequent to December 31, 2019 , we made additional capital contributions totaling $ 8.2 million based on capital calls received.

During the third quarter of 2020, Red River, which owns a crude oil pipeline running from Cushing, Oklahoma to Longview, Texas, completed a planned expansion project to increase the pipeline capacity and commenced operations on the completed expansion project on October 1, 2020.

We contributed $ 3.5 million related to such expansion project in May 2019.

During the year ended December 31, 2020, we made additional capital contributions totaling $ 12.2 million based on capital calls received.

Summarized financial information for Red River on a 100% basis is shown below (in thousands):

December 31, 2019

Year Ended Year Ended

December 31, 2020 December 31, 2019

Current Assets $ 13,488 $ 9,278

1 unchanged sentence

Current liabilities $ 7,789 $ 8,291

For the period

April 24, 2019 - December 31, 2019

Year Ended For the period

December 31, 2020 April 24, 2019 - December 31, 2019

Revenues $ 51,001 $ 38,352

Gross profit $ 31,103 $ 25,919

Operating income $ 30,382 $ 25,497

Net income $ 30,404 $ 25,548

Notes to Consolidated Financial Statements

4 unchanged sentences

Combined summarized financial information for these two equity method investees on a 100% basis is shown below (in thousands):

December 31, 2019

December 31, 2018

Year Ended Year Ended

December 31, 2020 December 31, 2019

Current assets $ 20,763 $ 29,476

2 unchanged sentences

Non-current liabilities $ — $ 8

December 31, 2019

December 31, 2018

December 31, 2017

Year Ended Year Ended Year Ended

December 31, 2020 December 31, 2019 December 31, 2018

Revenues $ 55,482 $ 48,703 $ 35,050

Gross profit $ 36,904 $ 30,473 $ 17,690

Operating income $ 34,951 $ 28,503 $ 12,909

Net Income $ 34,977 $ 28,601 $ 15,701

The Partnership's investments in these three entities were financed through a combination of cash from operations and borrowings under the DKL Credit Facility.

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We aggregate our operating segments into two reportable segments:

(i) pipelines and transportation and (ii) wholesale marketing and terminalling.

(i) pipelines and transportation;

and (ii) wholesale marketing and terminalling.

Our operating segments adhere to the accounting policies used for our consolidated financial statements.

6 unchanged sentences

Year Ended December 31,

2020 2019 2018

Pipelines and Transportation

Net revenues:

Affiliate $ 233,873 $ 155,211 $ 138,418

Third party 17,596 23,107 15,149

Total pipelines and transportation 251,469 178,318 153,567

3 unchanged sentences

Capital spending (1)

$ 7,631 $ 6,600 $ 6,840

Wholesale Marketing and Terminalling

1 unchanged sentence

Affiliate (2)

$ 148,793 $ 105,803 $ 102,391

Third party 163,156 299,871 401,651

Total wholesale marketing and terminalling 311,949 405,674 504,042

3 unchanged sentences

Capital spending (1)

$ 7,818 $ 3,387 $ 4,725

Net revenues:

Affiliate $ 382,666 $ 261,014 $ 240,809

Third party 180,752 322,978 416,800

Total Consolidated 563,418 583,992 657,609

4 unchanged sentences

Depreciation and amortization 35,731 26,701 25,990

Other operating expense/(income), net

Other operating (income) expense, net ( 66 ) 34 891

Operating income $ 179,793 $ 125,812 $ 125,757

Capital spending (1)

(1) Capital spending excludes transaction costs capitalized in the amount of $ 0.4 million that relate to the Big Spring Logistic Assets Acquisition for the year ended December 31, 2018 .

$ 15,449 $ 9,987 $ 11,565

(1) Capital spending excludes transaction costs capitalized in the amount of $ 0.4 million that relate to the Big Spring Logistics Assets Acquisition for the year ended December 31, 2018.

Additionally, capital spending for the year ended December 31, 2020, excludes transaction costs capitalized in the amount of $ 0.3 million that relate to the Trucking Assets Acquisition and $ 0.7 million that relate to the Big Spring Gathering Assets Acquisition.

(2) Affiliate revenue for the wholesale marketing and terminalling segment is presented net of amortization expense pertaining to the Marketing Contract Intangible Acquisition.

See Note 3 for additional information.

Notes to Consolidated Financial Statements

The following table summarizes the total assets for each segment as of December 31, 2020 and 2019 (in thousands).

Assets for each segment includes property, plant and equipment, equity method investments, intangible assets and inventory.

Year Ended December 31,

1 unchanged sentence

Wholesale marketing and terminalling 206,918 214,259

Notes to Consolidated Financial Statements

Other 26,182 20,522

Total assets $ 956,417 $ 744,447

For tax purposes, each partner of the Partnership is required to take into account its share of income, gain, loss and deduction in computing its federal and state income tax liabilities, regardless of whether cash distributions are made to such partner by the Partnership.

6 unchanged sentences

As a result, the Partnership must record deferred income taxes for the differences between book and tax bases of its assets and liabilities based on those states' enacted tax rates and laws that will be in effect when the differences are expected to reverse.

As of December 31, 2019 , the total non-current deferred tax liability was $ 0.2 million .

As of December 31, 2018 , the total non-current deferred tax asset was $ 0.3 million .

These amounts are included in other non-current liabilities and other non-current assets in our accompanying consolidated balance sheets.

The majority component of our non-current deferred tax liabilities and non-current deferred tax assets as of December 31, 2019 and 2018 , respectively, was depreciation and amortization.

As of December 31, 2020 and 2019, the total non-current deferred tax liability was $ 0.6 million and $ 0.2 million, respectively.

These amounts are included in other non-current liabilities in our accompanying consolidated balance sheets.

The majority component of our non-current deferred tax liabilities as of December 31, 2020 and 2019, respectively, was depreciation and amortization.

The difference between the actual income tax expense and the tax expense computed by applying the statutory federal income tax rate to income before income taxes is attributable to the following (in thousands):

Year Ended December 31,

2020 2019 2018

State income taxes $ 223 $ 967 $ 534

Income tax expense (benefit)

Income tax expense $ 223 $ 967 $ 534

Income tax expense (benefit) is as follows (in thousands):

Year Ended December 31,

2020 2019 2018

Current $ ( 178 ) $ 471 $ 382

Deferred $ 401 496 152

Total $ 223 $ 967 $ 534

Delek Holdings files a consolidated Texas gross margin tax return, and tax payments for the Partnership are paid by Delek Holdings.

Therefore, a portion of the current tax payable is included in accounts receivable/payable from related parties.

As of December 31, 2019 and 2018 , income taxes payable of $ 0.1 million and $ 0.3 million , respectively, were included in accounts receivable/payable from related parties in the accompanying consolidated balance sheets.

As of both December 31, 2020 and 2019, income taxes payable were immaterial and were included in accounts receivable/payable from related parties in the accompanying consolidated balance sheets.

Taxes that are determined on a consolidated basis apply the “benefits for loss” allocation method;

2 unchanged sentences

We recognize accrued interest and penalties related to unrecognized tax benefits as an adjustment to the current provision for income taxes.

There were no uncertain tax positions recorded as of December 31, 2019 or 2018 , and there were no interest or penalties recognized related to uncertain tax positions for the years ended December 31, 2019 , 2018 or 2017 .

There were no uncertain tax positions recorded as of December 31, 2020 or 2019, and there were no interest or penalties

Notes to Consolidated Financial Statements

recognized related to uncertain tax positions for the years ended December 31, 2020, 2019 or 2018.

We have examined uncertain tax positions for any material changes in the next 12 months and none are expected.

4 unchanged sentences

Environmental Health and Safety

We are subject to extensive federal, state and local environmental and safety laws and regulations enforced by various agencies, including the Environmental Protection Agency (the "EPA"), the United States Department of Transportation, the Occupational Safety and Health

Notes to Consolidated Financial Statements

Administration, as well as numerous state, regional and local environmental, safety and pipeline agencies.

These laws and regulations govern the discharge of materials into the environment, waste management practices and pollution prevention measures, as well as the safe operation of our pipelines and the safety of our workers and the public.

6 unchanged sentences

Crude Oil and Other Releases

We have experienced several crude oil and other releases involving our assets including five releases that occurred in 2019 and six releases that occurred in 2018.

Cleanup operations and site maintenance and remediation efforts on these and other releases have been substantially completed or have received regulatory closure, with the exception of one release, which is currently in boom maintenance.

Many of the releases have occurred on our system of common carrier pipelines (the "Gathering Assets").

During the year ended December 31, 2019 , we decommissioned certain sections of the Gathering Assets in an effort to improve the safety and integrity of the system.

We have experienced several crude oil and other releases involving our assets.

There were no material releases that occurred during the year ended December 31, 2020, and there were five releases that occurred throughout the year 2019.

Cleanup operations and site maintenance and remediation efforts on these and other releases are at various stages of completion.

The majority of the remediation efforts for these releases are substantially completed or have received regulatory closure.

With the exception of the Sulphur Springs release defined below, we expect regulatory closure in 2021 for the release sites that have not yet received it.

Many of the releases have occurred on our system of common carrier pipelines which gather crude in southern Arkansas and northern Louisiana, and which are primarily located within 60 miles of Delek Holdings’ El Dorado refinery ("El Dorado Gathering System").

During the year ended December 31, 2019, we decommissioned certain sections of the El Dorado Gathering System in an effort to improve the safety and integrity of the system.

The decommissioning of these sections was completed in August 2019.

The project did not have a material effect on the financial results.

The project did not have a material effect on our financial results.

Regulatory authorities could require additional remediation based on the results of our remediation efforts.

2 unchanged sentences

On October 3, 2019, a release of diesel fuel involving one of our pipelines occurred near Sulphur Springs, Texas (the "Sulphur Springs Release").

Cleanup operations and site maintenance and remediation on this release have been substantially completed where such costs incurred totaled $ 7.1 million as of December 31, 2019 .

Ground water wells for monitoring activities are expected to be installed in the first quarter of 2020.

We expect the monitoring period to last for at least a year.

Cleanup operations and site maintenance and remediation on this release have been substantially completed where such costs incurred totaled $ 7.1 million during 2019.

During the year ended December 31, 2020, we incurred approximately $ 0.5 million of additional costs related to final clean-up of this release.

Ground water monitoring wells were installed in the third quarter of 2020 and will be monitored quarterly until the site is closed.

Additionally, in the third quarter of 2020 we conducted creek bed sediment sampling and the results indicated no issues with the groundwater.

In the fourth quarter of 2020 we submitted an actual property assessment report (the

Notes to Consolidated Financial Statements

"APAR") that assessed site conditions and recommends closure of the site.

We filed suit in January 2020 against a third party contractor, seeking damages related to this release.

We have not received notification that any legal action with respect to fines and penalties will be pursued by the regulatory agencies.

Expenses incurred for the remediation of crude oil and other releases are included in operating expenses in our consolidated statements of income and comprehensive income.

The majority of our releases are subsequently reimbursed by Delek Holdings pursuant to the terms of the Omnibus Agreement, with the exception of the Sulphur Springs Release above as it is not covered under the Omnibus Agreement.

Reimbursements are recorded as a reduction to operating expenses.

We do not believe the total costs associated with these events, whether alone or in the aggregate, including any fines or penalties and net of available insurance, indemnification or reimbursement, will have a material adverse effect upon our business, financial condition or results of operations as we are generally reimbursed by Delek Holdings for such costs.

During the years ended December 31, 2019 , 2018 , we recorded approximately $ 0.4 million and $ 0.4 million of expense, respectively, which excludes the Sulphur Springs Release above and is net of total reimbursable costs from Delek Holdings pursuant to the terms of the Omnibus Agreement.

Reimbursable costs amounted to $ 4.8 million and $ 9.8 million for the years ended December 31, 2019 and 2018 , respectively, to cover the costs of asset failures.

Expenses incurred for the remediation of these crude oil and other releases are included in operating expenses in our consolidated statements of income and comprehensive income.

The majority of our releases have been subsequently reimbursed by Delek Holdings pursuant to the terms of the Omnibus Agreement, with the exception of the Sulphur Springs Release above as it is not covered under the Omnibus Agreement.

Reimbursements are recorded as a reduction to operating expense.

During the years ended December 31, 2020 and 2019, we recorded approximately $ 0.1 million and $ 0.4 million of expense, respectively, which is net of total reimbursable costs of $ 0.1 million and $ 4.8 million for the years ended December 31, 2020 and 2019, respectively, from Delek Holdings pursuant to the terms of the Omnibus Agreement.

In March 2013, a release of crude oil occurred from a pumping facility at our Magnolia Station located West of Delek Holdings' El Dorado Refinery (the "Magnolia Release").

1 unchanged sentence

In December 2018, the Partnership, the United States and the State of Arkansas reached an agreement to settle the claims related to the Magnolia Release abandoning the demand for a compliance audit at the Magnolia terminal in exchange for settlement payments totaling $ 2.2 million.

On November 8, 2019, a consent decree was entered with the Court and on November 20, 2019 final payments were made to the State of Arkansas in the amount of $ 0.6 million and to the DOJ in the amount of $ 1.7 million , which amounts include a no minal amount of interest.

Notes to Consolidated Financial Statements

Letters of Credit

As of December 31, 2019 , we had no letters of credit in place under the DKL Credit Facility.

On November 8, 2019, a consent decree was entered with the Court and on November 20, 2019 final payments were made to the State of Arkansas in the amount of $ 0.6 million and to the DOJ in the amount of $ 1.7 million, which amounts include a nominal amount of interest.

We lease certain pipeline and transportation equipment.

1 unchanged sentence

we recognize lease expense for these leases on a straight-line basis over the lease term.

Our leases do not have any outstanding renewal options.

Certain leases also include options to purchase the leased equipment.

Certain of our lease agreements include rates based on equipment usage and others include rate inflationary indices based increases.

Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The following table presents additional information related to our operating leases in accordance ASC 842:

Year Ended December 31,

Year Ended December 31, Year Ended December 31,

(in thousands) 2020 2019

Lease Cost (1)

Operating lease cost $ 7,478 $ 4,643

Short-term lease cost (2)

Variable lease costs 1,002 —

Total lease cost $ 10,332 $ 5,493

3 unchanged sentences

Leased assets obtained in exchange for new operating lease liabilities $ 26,528 $ 1,285

December 31, 2019

Leased assets obtained in exchange for new financing lease liabilities $ 5,562 $ —

December 31, 2020 December 31, 2019

Weighted-average remaining lease term (years) for operating leases 3.56 4.00

Weighted-average discount rate (3) operating leases

Weighted-average remaining lease term (years) for finance lease 2.92 0.00

Weighted-average discount rate (3) finance lease

(1) Includes an immaterial amount of financing lease cost.

(2) Includes an immaterial amount of variable lease cost.

(3) Our discount rate is primarily based on our incremental borrowing rate in accordance with ASC 842.

The following is an estimate of the maturity of our lease liabilities for operating leases having remaining noncancelable terms in excess of one year as of December 31, 2019 (in thousands) under ASC 842:

Notes to Consolidated Financial Statements

The following is an estimate of the maturity of our lease liabilities for operating leases having remaining noncancellable terms in excess of one year as of December 31, 2020 (in thousands) under ASC 842:

Thereafter 1,736

Total lease payments $ 35,237

Interest 11,128

Present value of lease liabilities $ 24,109

The following is an estimate of the maturity of our lease liabilities for financing lease having remaining noncancellable terms in excess of one year as of December 31, 2020 (in thousands) under ASC 842:

Total lease payment $ 5,547

Present values of lease liabilities $ 5,411

Selected Quarterly Financial Data (Unaudited)

2 unchanged sentences

For the Three Month Periods Ended

March 31, 2019

June 30, 2019

September 30, 2019

December 31, 2019

March 31, 2020 June 30, 2020 September 30, 2020 December 31, 2020

Net revenues $ 163,401 $ 117,637 $ 142,268 $ 140,112

Operating income $ 35,042 $ 47,881 $ 51,765 $ 45,105

Net income $ 27,796 $ 44,415 $ 46,328 $ 40,717

Limited partners' interest in net income $ 18,719 $ 34,768 $ 46,328 $ 40,717

3 unchanged sentences

For the Three Month Periods Ended

March 31, 2018

June 30, 2018

September 30, 2018

December 31, 2018

March 31, 2019 June 30, 2019 September 30, 2019 December 31, 2019

Net revenues $ 152,483 $ 155,342 $ 137,556 $ 138,610

Operating income $ 29,111 $ 32,256 $ 34,729 $ 29,715

Net income $ 19,696 $ 24,885 $ 30,530 $ 21,638

Limited partners' interest in net income $ 12,426 $ 16,806 $ 21,635 $ 12,804

9 unchanged sentences

by and through its general partner, Delek Logistics GP, LLC

/s/ Assaf Ginzburg

Assaf Ginzburg

/s/ Reuven Spiegel

Reuven Spiegel

Director, Executive Vice President and Chief Financial Officer

February 27, 2020

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by or on behalf of the following persons on behalf of the registrant and in the capacities indicated on February 27, 2020 :

March 1, 2021

/s/ Ezra Uzi Yemin

3 unchanged sentences

(Principal Executive Officer)

/s/ Assaf Ginzburg

Assaf Ginzburg

/s/ Reuven Spiegel

Reuven Spiegel

Director, Executive Vice President and Chief Financial Officer

(Principal Financial and Accounting Officer)

(Principal Financial Officer)

/s/ Nilah Staskus

Nilah Staskus

Senior Vice President, Chief Accounting Officer

(Principal Accounting Officer)

/s/ Sherri A.

/s/ Charles J.

/s/ Francis C.

/s/ Frederec Green

Frederec Green

Director and Executive Vice President

/s/ Reuven Spiegel

Reuven Spiegel

/s/ Frederec Charles Green

Frederec Charles Green

/s/ Gennifer F.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures